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Political uncertainty undermines discretionary contributions
Political and legislative uncertainty is taking its toll on superannuation fund members — something that has shown up in the result of the latest AMP Retirement Adequacy Index.
That is the assessment of the Association of Superannuation Funds of Australia (ASFA), which revealed that discretionary contribution rates had fallen to their lowest levels since the index began.
Commenting on the results, ASFA chief executive, Pauline Vamos said they suggested people were putting their money elsewhere.
“This is what we have warned about,” she said. “Continued uncertainty around superannuation rules will be a barrier to people increasing their retirement savings through the super system.”
Vamos said three policies were currently on the table and needed to be legislated as soon as possible — the three per cent increase in the superannuation guarantee, higher contribution caps for people over 50 and a rebate for low-income earners.
“These policies are easy to understand and ASFA research shows they are supported by consumers,” she said. “With an ageing population and the need to have more people self-funding their retirement, we need to get serious about this.”
AUTHOR
Mike Taylor
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