Budget wish for no super changes is looking shaky, history shows

FEDERAL treasurers have a long history of announcing rule changes to superannuation, now experts reveal why Scott Morrison should keep his hands off it.

CHANGES to superannuation rules and Federal Budgets go hand-in-hand, but all the super industry wants this year is for Treasurer Scott Morrison to keep his hands off.

A moneysaverHQ analysis has found that we haven’t had a Budget free of super changes since 2008.

The Association of Superannuation Funds of Australia is among those fed up with uncertainty around contribution limits and slow-rising compulsory employer Superannuation Guarantee payments.

“In the Federal Budget the government has a unique opportunity to reaffirm their commitment to retirees by simply leaving the system alone,” said ASFA CEO Martin Fahy.

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Martin Fahy, CEO of ASFA, says Australians deserve certainty around super rules.

“Constant tinkering with the system ultimately undermines community confidence at a time when we want to encourage more people to be self-funded in retirement,” Dr Fahy said.

“Australians deserve certainty when making investment decisions that their savings will not be eroded by constant shifts in Budget policy.”

Super savers are still working through previous Budget changes, and some don’t even start until July 1 this year — such as the new bring forward rule that allows unused tax-deductible contribution caps to be rolled over for five years.

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AMP Capital chief economist Shane Oliver said there had been some suggestions that the Budget might further delay plans to increase compulsory employer super payments to 12 per cent.

This Coalition has history with this. In 2013 Labor announced plans to raise SG payments to 12 per by July 2019, but in 2014 the Abbott Government slowed it down dramatically.

Our nest eggs are constantly being affected by rule changes.

Last week independent think tank the Grattan Institute said an SG increase from the current 9.5 per cent was unnecessary and would do little to help low-income Australians.

However, ASFA’s Dr Fahy slammed the Grattan proposal as condemning retirees to poverty. “Even an extra few thousand dollars a year will make a real difference in retirement — including allowing the retiree to undertake essential home repairs, visit the dentist, heat and cool their homes and have an occasional meal at the pub,” he said.

@keanemoney

SUPER-CONFUSING

2009: Contribution caps halved; co-contribution reduced

2010: Employer contributions (SG) extended to age 74

2011: MySuper created; SMSF changes

2012: Higher caps for over-50s

2013: SG rise to 12% by 2019

2014: SG rise delayed; changes to pension income

2015: Tougher age pension rules

2016: 10-plus including lower contribution caps and tax changes

2017: First home super saver scheme, downsizing for retirees

Originally published as Budget wish for no super changes is looking shaky, history shows