Retirement, Superannuation

Retirement review looking beyond remit

Retirement Income Review

The Retirement Income Review may cover more ground than its remit, based on the questions asked in its recently released consultation paper.

The Retirement Income Review is likely to cover more ground than its terms of reference, with questions in its recently released consultation paper going beyond establishing a fact base for government, according to an SMSF consultant.

Heffron Consulting executive director Martin Heffron said while the paper restated the review’s terms of reference and asked a series of question in areas about which it was seeking more information, “my initial impression from the nature of the questions is that the review is taking on far more than it was specifically tasked with considering”.

Heffron added that while the terms of reference indicate the review should “establish a fact base” to support future policy development, “the paper suggests the review will delve into far more subjective and challenging areas than simply establishing facts”.

“I would argue that 15 of the 26 consultation questions at the back of the paper have nothing to do with the establishment of facts,” he added, pointing to a question examining the roles of government, the private sector and individuals in helping people achieve an adequate retirement income.

“Aside from the fact that what constitutes an adequate retirement income hasn’t yet been determined (which makes answering this question rather difficult), this is either a philosophical or political question. There is no objectively correct response. Facts don’t come into it.”

He said it was likely the review had taken this approach to set parameters for any future discussion of retirement income.

“The complete lack of context within our retirement income system makes it almost inevitable that anyone considering our system properly must first try to establish some,” he noted.

He added issues such as the purpose of the retirement income system, the extent of state responsibility and the level of adequacy were not defined.

“These are all big, unanswered questions that deserve broad community-level answers. Given the vacuum created by those within the Australian community that should be answering them, the review has stepped up to the plate and looks like it is going to give most of them a go,” he said.

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