The SMSF Professionals’ Association of Australia (SPAA) is urging the Coalition not to defer the increase in the Superannuation Guarantee (SG) if it wins government at the election scheduled for 15 September 2013.
The Labor Government increased the SG from 9% to 12% over six years to 1 July 2019, with the first increase of 0.25 per cent to take effect on 1 July. But the Opposition leader, Tony Abbott, said in his Budget reply on Thursday that a Coalition Government would delay the SG increase by two years, saving the budget $1.1 billion.
Graeme Colley, SPAA’s Head of Technical and Professional Standards, says: “Any decision that defers an increase in the SG simply reduces the adequacy of Australians’ retirement savings.
“SPAA would ask the Coalition to think carefully about such a move, especially in light of its recent commitment not to make any changes to superannuation.”
The Coalition’s policy, if implemented, would affect the superannuation savings of 8.4 million Australians, with the two-year delay meaning super contributions would only reach 12% by 1 July 2021.
Mr Colley adds that for many employers there will be no increase in costs as a higher SG will be funded from employees’ salaries and will actually reduce the amount of take home pay.
