Conservative think tank, the Grattan Institute has managed to unite the superannuation industry against it with its latest analysis around retirement funding and lifting the superannuation guarantee (SG) to 12 per cent.
The Association of Superannuation Funds of Australia (ASFA), the Australian Institute of Superannuation Trustees (AIST) and Industry Super Australia (ISA) were all prompted to dismiss the Grattan Institute analysis on the basis of it being yet another spurious attack on the superannuation system.
ASFA chief executive, Dr Martin Fahy, led the way by claiming the Grattan analysis “continues the pattern of selective and misleading modelling that seeks to undermine a retirement system that is globally acknowledged as one of the best in the world”.
“Good public policy will always benefit from lucid, rigorous research and modelling,” he said. “However, the Grattan Institute’s latest output is based on unsound assumptions regarding average earnings, working patterns, the future rate of the Age Pension, how the means test for the Age Pension works, and most importantly working Australians’ aspirations for a dignified retirement.”
Fahy’s attack on the Grattan analysis was followed by that of the ISA with its acting chief executive, Matthew Linden claiming the analysis actually contradicted other recent Grattan analysis which had claimed increasing the SG to 12 per cent would ease the burden on the age pension.
Like ASFA, Linden accused the Grattan Institute of having double-counted salary sacrifice contributions and having over-estimated voluntary contributions and the amount of the age pension.
AIST head of advocacy, Ailsa Goodwin added her voice to the criticism and said it was the assets test, not the superannuation system or the superannuation guarantee time-table that were flawed.
“The changes to the age pension asset test in the Coalition’s budget of 2015 have hit middle Australia hard, with many retirees either losing their part pension altogether or suffering pension cuts,” she said. “Adjusting the taper rate is critical to the integrity of our super system and indeed the wider retirement income systems. We need to restore appropriate savings incentives so that that super can do what it was designed to do for middle Australia, which is to supplement the age pension.”