Treasurer Scott Morrison has announced that the government will provide the stability missing from the superannuation system and may lift concessional contribution caps in order to achieve flexibility in the system.
“[Superannuation] is not a tax incentive for estate planning,” Morrison told the 2016 SMSF Association National Conference in Adelaide today.
“And with the [government’s] back-to-basics approach I think now we can deliver the stability and certainty that this sector craves and needs; a system that is actually reflective of the modern working lives of Australians and a system that if the balance is right, will be tinker-free for a very long time.
“We have not made any changes to superannuation in our parliamentary term to date.
“We did think it was important to actually give those issues a breather, but the way that the debate has bubbled up again in recent times means there are still issues that need to be resolved. And we wish to resolve them.”
On the matter of flexibility, the government will continue to explore how it can help people who take time out of the workforce, Morrison said.
“This is not a simple issue. It really isn’t,” he said.
“It’s a pressing issue though because right now the average super balance for women is $52,000 less than men.
“This is why the government is examining how we can tackle such deficiencies, how we can have a superannuation system that reflects changes in people’s lives.”
He said that many ideas had been floated.
“To give you one example we can potentially lift the caps on superannuation contributions for those who experience lengthy disruptions in their working life,” he said.
This could include carers as well as women, he said.
SMSF Association chief executive Andrea Slattery asked Morrison whether the government could ever see super being separated from the short-term budget cycle.
“I would hope that we’ll be able to come to a landing point very, very soon and work through with yourself and the other representative organisations and if we’re in a position to make an announcement on this sooner rather than later, then I think the Prime Minister and I would both like to do that,” Morrison said in response.
“And then it would certainly be my hope that this wouldn’t be a matter that then would need to be revisited.”
Morrison added it was important that the government approached taxation of super with an open mind and without prejudice in order to make the right call for the whole system.
“Our economy is the best place to be in the developed world in these uncertain times and my job, and the Prime Minister’s job, is to back Australians as this transition continues,” Morrison said.
“And that includes backing SMSFs, and where you’re able to take those services, knowledge, know-how and innovation, and apply that to what can be exported up into the region.
“That’s the plan.”