Budget super reforms deliver mixed outcomes: AFA
Brad Fox – CEO – AFA
Last week’s release by the Federal Government of proposed changes to superannuation provide mixed results for Australians, according to the Association of Financial Advisers (AFA).
“Yesterday the AFA called for an amnesty on superannuation and today’s announcement has gone a long way to maintaining consumer confidence,” said AFA CEO, Brad Fox.
“However, we are concerned that the measures may result in further superannuation complexity.”
Mr Fox says the AFA applauds the Government for increasing the concessional contributions caps and for limiting further tax increases on superannuation to a minority.
“We are very pleased that industry lobbying for an increase in concessional contributions caps has paid off,” he said.
“It will mean that more Australians will be able to better prepare for retirement.”
The AFA also applauds the move to form a Council of Superannuation Custodians (the Council) and the establishment of a Charter of Superannuation Adequacy (the Charter) to define future superannuation principles from a policy setting perspective.
“We would however like to see more detail on the proposed structure of the Council and how it will be convened,” Mr Fox said.
Mr Fox also said protecting the integrity of the superannuation system is paramount so that the 20 years of compulsory superannuation participation by Australian workers and employers is protected for the purpose it was intended – as a long-term savings vehicle to provide for retirement.
“We are hopeful that the Charter will have a positive influence on superannuation policy settings,” he said.
However, Mr Fox expressed concern about the increase in tax and complexity that may result from the Government’s proposals.
“Any increase in tax and any further complexity of our superannuation system will inevitably result in Australians losing faith in super,” he said.
“If this happens, Australians may well look to alternative avenues when saving for retirement.”
The AFA is considering the full detail in the release and will make further statements at an appropriate time.
