Fund chief warns of super tinkering
The federal opposition's plan to scrap a tax rebate on super contributions of low-income earners is a "retrograde" policy that will hurt 3 million Australians, the head of the country's biggest super fund has warned.
Australian Super chief executive Ian Silk has also called for the industry to be "depoliticised", warning that Canberra's constant tinkering with the system is causing people to lose faith in it.
Speaking at the Stockbrokers' Association annual conference on Friday, Mr Silk said the $1.5 trillion super system should not be used by governments as a "revenue generating vehicle" whenever the budget came around.
"Wouldn't it be wonderful if we could depoliticise [it]," he said.
In April, federal Superannuation Minister Bill Shorten announced plans to establish a council of superannuation "custodians" who would assess future changes to the super system against an agreed charter of values.
The council would be able to make changes to the super system in an apolitical way, as "the Reserve Bank makes decisions about interest rates," Mr Shorten said about the plan.
But the proposal has received a cool response from the opposition. Senator Mathias Cormann said his party opposed a "new bureaucracy".
In recent months, debate has also flared up about plans to lift the rate of compulsory superannuation contributions from 9 per cent to 12 per cent. Opposition Leader Tony Abbott said in his budget reply speech that he would delay by two years any increase in compulsory contributions because businesses could not afford it now, given the state of the economy.
But Mr Silk said Mr Abbott's plan was "another example" of political tinkering that could reduce public confidence in the superannuation system, "by virtue of being yet another change to what peoples' expectations and understandings were".
"I thought Bill Shorten's idea was a very good one," Mr Silk said, in reference to the plan to establish a council of super custodians.
"The fact that he's put it into the public realm and it was so forthrightly rejected suggests that it might not have legs itself," he said.
"But the notion that superannuation is taken out of the partisan pie-throwing environment of politics is one that would be welcomed by the industry but more particularly would be enthusiastically embraced by members of superannuation funds."
Australian Super looks after the super of 2 million members with $59 billion in savings.