Colin Brinsden, AAP Economics Correspondent
(Australian Associated Press)
Scott Morrison believes the Turnbull government’s suite of superannuation changes will provide greater confidence for Australians to invest for their retirement.
The treasurer introduced his superannuation package to the House of Representatives on Wednesday, having indicated earlier he hopes it will be passed in the final sitting weeks of this year, even if the Senate wants to scrutinise the legislation through an inquiry.
Among the key elements of the package, non-concessional super contributions will be limited to $100,000 per year from July 1, 2017 compared to $180,000 presently, but it allows for catch-up contributions, such as in the case of women returning to work after having a baby.
However, individuals with a super balance of more than $1.6 million will no longer be eligible to make after-tax contributions.
Mr Morrison said these measures would improve the fairness, sustainability, flexibility and integrity of the super system.
“This will make it possible for Australians to manage their superannuation and plan for their retirement with confidence,” he told parliament.
He says as the population ages, it is not sustainable to have ever-increasing earnings generated from very high superannuation balances being completely tax free.
The government also wants to clearly define the objective of superannuation into law – that is, to provide income in retirement to substitute or supplement the age pension.
“This is the first time we’ve had such definite recourse to what the purpose of the superannuation system is,” Mr Morrison said.
The government took the super package to the election, which at that stage included a controversial $500,000 lifetime non-concessional cap on fund balances back to 2007.
But in September it bowed to internal pressure and instead limited after-tax contributions to $100,000 per year.
Earlier, Mr Morrison resumed his attack on Labor for what he has described as its “secret” super agenda, because it wants to reduce the cap to $75,000, saving the budget a further $1.4 billion over the next four years and $19 billion over a decade.
Responding to Mr Morrison’s accusations of lying to the electorate over super, Opposition Leader Bill Shorten said it was the government that was breaking its promises.
“Remember their iron-clad commitment they were not going to change their superannuation laws? Every day is a new policy out of this mob in terms of the superannuation,” Mr Shorten told reporters in Canberra.