Retirement
How did the super industry react to the federal budget?
Australia’s superannuation industry has greeted the biggest changes to super included in this year’s federal budget with broad approval.
How did the super industry react to the federal budget?
Australia’s superannuation industry has greeted the biggest changes to super included in this year’s federal budget with broad approval.
“The budget announcement included a number of positive changes to superannuation which will not only benefit Australians approaching, and in, retirement, but will also benefit younger home buyers,” said BDO Australia’s Paul Rafton.
A full round-up of the super changes in this year’s federal budget can be found here.
ANZ
ANZ chief executive Shayne Elliott was similarly optimistic, framing it as a key driver for Australia’s economic recovery from the pandemic.
“This is the right budget for these economic times and is good news for Australian industries, households and social services.”
“While it is more stimulatory than many would have anticipated, this reflects the reality that the pandemic still poses risks to our health and economic prosperity and once again shows the government’s flexibility in dealing with the ongoing impacts,” Mr Elliott said.
Across the board, super funds were pleased with the abolishment of the $450 minimum threshold.
HESTA
“HESTA has been calling for the scrapping of the unfair $450 super threshold for more than 10 years, so it’s pleasing the government has taken this long overdue step as it will help improve financial security for women and the lower paid,” said HESTA CEO Debby Blakey.
Ms Blakey added that HESTA members would welcome the government confirming they would stick to the existing timeline that promises to see the superannuation guarantee rate rise to 10 per cent in July 2021 and 12 per cent in 2025.
REST
According to Vicki Doyle, chief executive officer at Rest, “This will have a positive impact on the retirement savings of Australians, and particularly will help those who accessed the COVID-19 early release scheme replenish their account balances.
“Likewise, the repeal of the work test and the expansion of downsizer contributions will provide further opportunities for people to boost their retirement savings.”
Ms Doyle was less enthusiastic about the omission of superannuation contributions within the Parental Leave Pay, Dad and Partner Pay schemes, calling it out as “a missed opportunity to make further progress in closing the gender gap in retirement savings.”
“We strongly encourage the Government to implement this change at the earliest opportunity,” Ms Doyle said.
Industry Super Australia
Industry Super Australia chief executive Bernie Dean said that “after employers and workers pulled the economy through a really tough year, it’s good that Australians can bank on super going to 12 per cent, but a real let down that the government didn’t take the opportunity to close the gender gap by getting super paid on paid parental leave”.
SMSF Association
Looking at the wider world of superannuation firms, the relaxing of residency rules for self-managed super funds scored approval from SMSF association CEO John Maroney.
He said, “The removal of the active member test significantly simplifies the residency rules for both SMSFs and small APRA funds.”
IOOF
IOOF’s TechConnect team also commented on this change, noting that “this measure fixes another archaic rule that is no longer relevant in a global workforce. Advisers can assist non-resident clients with multiple funds to consolidate them into their SMSF or SAF.”
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