The Australian Institute of Superannuation Trustees (AIST) has welcomed the Federal Government’s move to enshrine super objectives in legislation, with chief executive, Tom Garcia, saying it would prevent super from constant, ad-hoc changes.
Garcia said the super industry had witnessed different proposals almost every week, resulting in uncertainty for members saving for retirement.
“Since the start of this year alone, we’ve had calls for super to pay off university debt, for super to save the agricultural industry, for super to pay off home loans and for low-income earners to opt out of compulsory super altogether.”
The Association of Superannuation Funds of Australia (ASFA) said the purpose of the super system as outlined by the Government in its discussion paper is to substitute or supplement the Age Pension, but added that the system was still maturing and broken work patterns still put people at a disadvantage.
ASFA chief executive, Pauline Vamos, also agreed with the Government that the super system should not be used as a vehicle for estate planning and welcomed bipartisan support in developing legislation that she hoped would de-politicise it.
“We can achieve this by reviewing how much individuals are able to accumulate in the system. ASFA supports the establishment of a measure of adequacy and proposes that the ASFA comfortable retirement standard be adopted as the standard which the community aspires to in retirement,” she said.
“ASFA also welcomes the Productivity Commission review into the efficiency of the system and look forward to the release of a draft framework to enable the development of greater choice in products providing income streams throughout retirement.
Meanwhile, Industry Super Australia chief executive, David Whiteley, said: “Hopefully, it will also help to liberate superannuation policy from the constant unhelpful political tinkering that comes with the Budget and election cycles.”
The Financial Services Council (FSC) said defining super objectives was vital to develop a mature super sector to deliver optimal outcomes, along with the Financial System Inquiry’s recommendations to raise governance standards and promote competition in super.
It was also pleased the Opposition had indicated bipartisan support for enshrining the definition of super in legislation.
