Will raising the super access age hit workers?

Amid discussion of raising the superannuation access age beyond 60 to try and mitigate the effects of increased life expectancy, Deakin Law School has found the benefits of an increase would not outweigh its detrimental increase on workers.

Such a policy change could leave “many workers in a position where they have no viable choice but to continue to work” according to tax and superannuation expert, Dr Rami Hanegbi.

He pointed to physically demanding jobs such as bricklayers as examples of situations where this would pose a significant problem.

Raising the super access age would also impact those in non-physical roles negatively, as it would eat into their retirement time. While life expectancies have increased, that has not been coupled with a similar growth in ‘healthy life years’.

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“As a result, raising the superannuation access age from say 60 to 65 would dramatically reduce the percentage of one’s life spent in the ‘golden years of retirement’ where one is both retired and in good health,” Hanegbi said.

“The negative impacts of such a policy on people’s right to self-determination, as well as on widespread confidence in the superannuation system, are also important consequences on legislating such a policy.”

Hanegbi warned that any economic benefits of the change “are likely to be limited”. He also said that, given the importance of superannuation, changes should not be made rashly.

“Compulsory superannuation has been a part of the retirement landscape in Australia for more than 20 years, with the availability of retirement funds having a marked affect not only on taxpayers but also their families and other members of the community.

“The consequences of making changes therefore needs to be carefully considered.”