The Federal Government has canvassed the formulation of a retirement income framework within which superannuation funds could deliver outcomes to retiree members.
The Minister for Revenue and Financial Services, Kelly O’Dwyer has told a Financial Services Council (FSC) conference that the consultation process around comprehensive income products in retirement (CIPRs) had convinced her “of the absolute need to have a retirement income framework”.
She said that, as things currently stand, superannuation trustees had a number of important obligations, including considering investment strategy, risk and appropriateness of insurance but it was surprising there existed no specific obligation to consider the needs of members in retirement.
“That needs to change,” O’Dwyer said. “Trustees should be assisting their members by designing and offering appropriate retirement income solutions and by reducing the complexity of member decisions around retirement.”
“What’s more, a retirement income framework would complement the objective of superannuation and align with other countries where retirement savings schemes typically provide a ‘decumulation’ structure.”
The minister said that it was in these circumstances she believed further industry consultation was necessary to ensure the Government got the principles underpinning the retirement phase right and “to ensure we are working toward a solution which truly addresses the challenges facing Australians as they move into retirement and make decisions about how to deploy their super savings”.
