Treasurer Scott Morrison on Friday outlined the government’s vision for a new retirement income system in a speech to the Association of Superannuation Funds of Australia (ASFA).
Mr Morrison made it clear that the Turnbull Government’s position is that no Australian should expect to receive an Age Pension when they retire, while also suggesting the currently generous superannuation tax breaks enjoyed by the very wealthy will be reined in.
The Treasurer conceded that twenty years after the introduction of compulsory superannuation that the current system is not yet efficient enough to supplement or replace the Age Pension.
Scott Morrison said that the Age Pension should not be regarded as an entitlement, instead, it should be regarded as a welfare payment for those who do not have the ability to save enough to fund their own retirement.
The Superannuation Act will be altered next year to enable most Australians to enjoy the “worthy prize” of an “independent retirement”. These changes will reflect the recommendations adapted from the Financial Systems Inquiry.
Read the full speech at treasury.gov.au
Read more from www.theage.com.au
Scott Morrison has once again gone out of his way to call the Age Pension a welfare payment, refusing to acknowledge that the Age Pension is an entitlement earned from a life of hard work and paying taxes.
As most of you reading this know first-hand, a life on the Age Pension isn’t glamorous. The labelling of the payment as a welfare handout is not only insulting to those living on it, but shows a real disconnect between Mr Morrison and the original reason behind the introduction of the Age Pension in 1908 as a ‘reward for service’.
Mr Morrison is guilty of being ahead of his time in trying to push a transition away from Australian workers retiring directly into an Age Pension. He even conceded in his speech that the current superannuation system isn’t efficient enough to replace or supplement the Age Pension.
So why keep toeing the welfare payment line? Why not do something about the inefficiencies of the current superannuation system. For example, why not remove the hold on the current Government has placed on the increase to the rate of employer superannuation guarantee contribution? Why not stop plans to abolish the Low Income Superannuation Contribution? And why not do something about the rort on superannuation taxation currently enjoyed by many of the country’s high earners?
It’s time to start calling the Age Pension for what it actually is Mr Morrison, an entitlement.
What do you think? Is Scott Morrison side-tracking important changes to the retirement income system by getting caught up in playing politics on the Age Pension? Do you agree that the Age Pension should still be considered an entitlement or do you feel it has now evolved into a welfare payment/safety net?