The Federal Budget superannuation measures has been given a qualified welcome by the industry, with the Australian Institute of Superannuation Trustees (AIST) leading the way by welcoming the measures aimed at making the system more efficient by lamenting its failure to address retirement outcomes for women.
AIST chief executive, Eva Scheerlinck said while it was pleasing that the Government had not deferred the timetable to increase the compulsory super guarantee to 12 per cent, more needed to be done to address the gender gap retirement savings that sees women retire with about half the super of men.
AIST previously called on the Government to back a proposal from Women in Super for an annual $1000 boost to super savings of low income women and had also advocated for the removal of the $450 monthly income threshold.
“While Budget measures to help pensioners access their home equity and expand the Pension work bonus are welcome, this doesn’t address the problem of most Australian women retiring with inadequate super balances and being almost entirely reliant on an age pension that is very low by international standards,” Scheerlinck said.
The expanded Pension Work Bonus will allow pensioners to earn an extra $1300 a year without reducing their pension payments. The Pensions Loan Scheme will be expanded to all Australians over the pension age, including self-funded retirees.
However KPMG expressed deep concern about the impact of the changes to insurance inside superannuation arguing that the cost might well outweigh the benefit.
KPMG Superannuation Advisory Partner, Adam Gee said the firm's modelling showed that the current system facilitated greater insurance coverage for a larger part of the population, which helped to reduce Australia’s long-standing underinsurance issue.
"Many more people are covered, and to a much greater degree, than if they relied on government support," he said. "Death benefits also allow the surviving spouse to carry on working rather than having to leave the workforce and look after children – an important societal and economic benefit."