The federal government has continued to press its view that tax concessions for some superannuation members are unfair and the application of additional measures will improve equity in the system.
Minister for Financial Services Stephen Jones said the government’s ongoing work to strengthen the superannuation system, which included contributions being paid on time and improvements in the performance of Australian Prudential Regulation Authority (APRA)-regulated funds, “also means that we need to ensure it reflects society’s expectations around fairness”.
“In just the past week, the tax office revealed that there are 42 self‑managed superannuation funds with assets in excess of $100 million,” Jones said in a speech at the AFR Super and Wealth Summit in Sydney yesterday attended by APRA-regulated fund and investment management firm representatives.
“No one is decrying that success, but you’ll have a hard time convincing me that these accounts need their current level of taxpayer support.
“The top 10 per cent [of super members] receive over 40 per cent of the current earnings concessions and the cost of superannuation concessions will exceed the cost of the age pension by the 2040s.
“So, we think it is a fairer outcome if we modestly reduce the tax concessions for some of these accounts with very high balances.
“We’re not capping how much can be held in superannuation and the tax concessions will still be generous for everyone, but budgets are about trade‑offs.
“If you think the current tax concessions are appropriate, then you will need to find those savings by cutting services somewhere else. Our decisions mean we can go further to improve the equity of the system.”
He added the government’s superannuation policy agenda was bound together by its proposed objective of super, despite the bill setting that out still being before parliament nearly a year after it was introduced.
“[The objective is] that savings would be preserved to deliver income for a dignified retirement – alongside government support – in an equitable and sustainable way,” he said.
“So we are committed to a system where every dollar of super is paid. A system that maximises performance and a system that puts the member’s needs at the centre.
“This is the vision for better retirement incomes for all Australians. That’s the objective of super.”
