Govt warned against further delays to lifting the SG

27 April 2017
| By Mike |
image
image
expand image

Just weeks out from the Federal Budget a survey has confirmed continuing strong support for the Government to restore the timetable for lifting the superannuation guarantee (SG) to 12 per cent.

The survey, conducted by Super Review during the recent Conference of Major Superannuation Funds (CMSF), revealed a strong majority of superannuation fund trustees and executives believed restoring the SG timetable would be the most positive outcome from the Budget.

In doing so, the survey confirmed broad cross-industry support for the Government to avoid any further slowing of SG increases with the Financial Services Council (FSC), having earlier this year used its pre-Budget submission to urge removal of the proposed two-year delay in lifting the guarantee to 12 per cent.

The FSC warned that the proposed two-year delay in the scheduled increase in the SG would undermine the effectiveness of the increase.

“For those who are likely to retire over the next decade, the delay detracts from the forecast $39,000 increase in individual retirement savings that they would otherwise have accrued,” the FSC submission said.

“Significantly, the proposed delay to the phasing in of the Super Guarantee to 12 per cent will result in a cumulative impact of around $40 billion less in super savings in the system over the next seven years,” it said. “The FSC strongly recommends that there be no further delays to the increase in the SGC to avoid exacerbating inter-generational pressure on public finances resulting from demographic change in Australia’s population.”

The Super Review survey revealed that nearly 60 per cent of respondents believed that restoring the original timetable for increasing the SG should be the Government’s superannuation priority in the Federal Budget ahead of further clearing the way for more sustainable retirement income products.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest developments in Super Review! Anytime, Anywhere!

Grant Banner

From my perspective, 40- 50% of people are likely going to be deeply unhappy about how long they actually live. ...

10 months 2 weeks ago
Kevin Gorman

Super director remuneration ...

10 months 3 weeks ago
Anthony Asher

No doubt true, but most of it is still because over 45’s have been upgrading their houses with 30 year mortgages. Money ...

10 months 3 weeks ago

The central bank has served up a disappointment for punters on Melbourne Cup Day....

4 hours ago

The fund’s inaugural chief retirement officer is looking to establish a new venture. ...

9 hours ago

The sovereign wealth fund remains cautious of the impact of high inflation as it announces a strong return in its latest update....

1 day 2 hours ago