Retirees should be able to manage their own retirement income within their individual priorities whether they have superannuation or not, according to the Association of Independent Retirees (A.I.R.) president Max Barton.
A.I.R. is calling for a Productivity Commission inquiry into Australia's superannuation system.
"Superannuation accounts should become a retiree's individual fund management vehicle rather than having to have super pensions, private bank accounts and a myriad of forms and restrictions," he said.
"The best retirement model for Australians is one which allows them to have responsibility for their own financial affairs within a framework of assistance and minimal regulatory control.
"This applies equally to those with superannuation and those without," he said.
One tenth of Australians had to build their retirement assets outside of super, according to Barton, because they did not have traditional employer/employee relationships.
They were forced to pay full margin tax on all income whether they were building assets or using them to live on, he said, and were offered no similar super tax concessions.
Nearly half of Australians were being bombarded daily with industry and union interests which was eroding confidence in the system, Barton said — and a Productivity Commission enquiry would take the debate outside the public arena.
He said seven months of public stoush and debate between the political parties was unacceptable.
Barton said prominent economists had warned of the perils of increasing compulsory superannuation to 12 per cent, as investments would have to be made overseas, removing assets that support the growth of Australian industry.
The size of funds meant assets could not be used to encourage the development of small business, which was the engine for growth and employment in Australia, according to Barton.
Barton said Australians were being continuously reminded of the inadequacy of their retirement savings, but no constructive approaches to relieve the anxiety of the issue had been put forward.
Although government initiatives were aimed at encouraging retirees to lead an active life and extend their working lives, the "so-called work test" prevented many of them from gaining employment to subsidise their income.
"The sensible way forward is to have the issues examined in a constructive way through the Productivity Commission," he said.
