| The superannuation system should be fully integrated into the social security and taxation system, with the prime objective of increasing the capacity of people to save for retirement.
The Australian Democrats support a superannuation system based on compulsory and voluntary savings to ensure that Australian's have an adequate standard of living in retirement and are able to meet reasonable lifecycle requirements. Retirement incomes policy should be based on a mix of a fair government funded pension, compulsory superannuation contributions, voluntary superannuation contributions, and personal lifetime savings.
We supported the introduction of the Superannuation Guarantee system of compulsory superannuation as a means of reducing the strain on the federal budget, raising national savings and meeting the future costs of an ageing population. It has been a great success as a capital raising and savings measure.
The principles to be followed should include:
The superannuation system should be fully integrated into the social security and taxation system, with the prime objective of increasing the capacity of people to save for retirement;
Superannuation savings should be encouraged by taxation incentives that are designed to achieve the necessary savings targets, and are fair, progressive and avoid excessive tax minimisation by high income earners;
Taxation incentives should also be developed to encourage long-term savings for other essential lifecycle needs (such as health, education, housing and aged care services);
Public policy should discourage retirees from taking early lump sum superannuation payments which are to the detriment of their long-term needs for later income streams;
Superannuation trustees should be subject to strict duties and obligations to make sure they are acting in the best interest of members, with a low cost dispute resolution mechanism to resolve complaints;
All workers should have access to an award based or employer sponsored superannuation fund run by joint employer-employees trustees acting in the interests of employees;
Prudential regulatory authorities should ensure that fees and charges are monitored and minimised, that multiple and lost accounts are reduced, and that all relevant factors in making an informed choice about superannuation are fully exposed to superannuation customers;
Discrimination on the bases of sex, age, marital status, sexual preference, race, disability or any other ground should be eliminated from superannuation policy, unless defendable on actuarial grounds.
What is now needed is reform, and the fairer treatment of superannuation and savings to encourage people to save more and to give them more confidence in the superannuation system.
The Democrats propose:
We need a concerted national review and a long-term plan of how to lift our national savings and how to develop more domestic capital. In time greater savings and capital generation will reduce our over-reliance on foreign capital;
Restructuring the many billions of tax concessions underpinning superannuation to reduce the 33 cent in the dollar rebate available to high income earners and to increase the puny 6 cents in the dollar rebate given to low income earners;
Increasing tax breaks on long term savings to encourage people to save more for life cycle needs like health, education and housing;
Maintaining award clauses regulating workers' superannuation, but allowing more choice of funds either individually or collectively, subject to appropriate consumer safeguards;
Superannuation trustees should continue to be regulated by comprehensive federal regulation to make sure that they are acting in the interests of members, with a low cost tribunal to resolve complaints;
Members of superannuation funds need more say in how funds are invested, for example, with the option of more funds going into Australian small businesses, venture capital or infrastructure projects, or into ethical investments, or into different risk categories;
Closing tax minimisation loopholes that cost up to $3 billion in lost taxes on financial instruments, and which subsidise debt for speculation. Instead, tax breaks should be expanded for long term savings and for investments which generate new jobs and business opportunities;
Superannuation laws and policies should be simplified. A national education campaign is needed to explain superannuation to members and provide more information on superannuation investments;
Maintaining the role of the Senate Select Committee on Superannuation in reviewing superannuation laws and policies, providing for public input into inquiries and recommending better ways of protecting and enhancing savings.#
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The Australian Democrats support a superannuation system based on compulsory and voluntary savings to ensure that Australian’s have an adequate standard of living in retirement and are able to meet reasonable lifecycle requirements. |
