The country’s major superannuation funds would guarantee an annual income for millions of retirees under a confidential proposal from the Albanese government as it prepares for a flurry of withdrawals from the super system.

While the pension pool has swelled to $4.1 trillion, the federal government and funds are increasingly assessing how to manage an inflection point when more money flows out of savings as a larger proportion of the population reaches retirement age and life expectancy grows.