Super industry fights plan
The Coalition has long promised to get rid of the low-income super concession, a payment of up to $500 a year for people earning up to $37,000, due to its links with the former government's mining tax.
The concession is designed to compensate low-income earners for contributions tax paid on their super, and the industry argues that scrapping it hurts the low-paid, especially women and casual or part-time workers.
Four industry groups - Women in Super, the Australian Institute of Superannuation Trustees, Industry Super Australia and the Association of Superannuation Funds of Australia - argued to retain the concession in Canberra on Wednesday.
Alissa Harnath, of Women in Super, said holding on to the payment would be the group's "main focus for the next six months, absolutely".
"The Greens and Labor are behind it," she said. "We will continue to lobby on it."
The push comes as the superannuation industry waits on a consultation paper to be released on Thursday by Assistant Treasurer Arthur Sinodinos. The paper will cover fund governance and the opening up of default funds in the modern award system.
It follows calls by the Productivity Commission and think tank the Grattan Institute for the government to increase the age at which people can access the age pension to 70.
The Grattan Institute also suggested the government lift the age at which people can access their super - called the preservation age - to 70.
The Financial Services Council, the lobby group for retail super funds such as AMP, has also backed a phased increase in the preservation age, to 62. The council does not support the abolition of the super concession.
Frequently Asked Questions about this Article…
The low-income super concession is a payment of up to $500 a year for individuals earning up to $37,000. It's designed to compensate low-income earners for the contributions tax paid on their superannuation. This concession is particularly important for low-paid workers, especially women and those in casual or part-time roles, as it helps boost their retirement savings.
The superannuation industry is opposing the government's plan because scrapping the low-income super concession would negatively impact millions of low-paid individuals. Industry groups argue that removing this concession would hurt those who need it most, such as women and part-time workers, by reducing their retirement savings.
Organizations such as Women in Super, the Australian Institute of Superannuation Trustees, Industry Super Australia, and the Association of Superannuation Funds of Australia are advocating to retain the low-income super concession. They are actively lobbying to ensure this benefit remains available to low-income earners.
The Greens and Labor parties are supporting the retention of the low-income super concession. They are aligned with industry groups in lobbying against the government's plan to abolish this important benefit for low-income earners.
The Productivity Commission and the Grattan Institute have proposed increasing the age at which people can access the age pension to 70. Additionally, there are suggestions to raise the superannuation preservation age, which is the age at which individuals can access their super, to 70 as well.
The Financial Services Council supports a phased increase in the superannuation preservation age to 62. However, they do not support the abolition of the low-income super concession, recognizing its importance for low-income earners.
Changes to the superannuation system, such as scrapping the low-income super concession or increasing the preservation age, could significantly impact everyday investors. These changes could reduce retirement savings for low-income earners and delay access to superannuation funds, affecting financial planning and retirement readiness.
Women in Super is currently focused on retaining the low-income super concession. They are actively lobbying and working with political allies to ensure this benefit remains available to support low-income earners, particularly women, in building their retirement savings.
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