Watchdog for 'tax fiddling'
A new Reserve Bank-style council will protect retirement savings from meddling politicians, says the Minister for Financial Services, Bill Shorten.
The Council of Superannuation Custodians, first flagged on Friday, is intended to stop governments from fiddling with tax concessions to fill budget holes or otherwise changing the rules without long notice periods.
The council would act as an independent umpire that would transparently evaluate proposals and publish data on costs and benefits of existing superannuation concessions and any mooted changes.
"We separated monetary policy from the day-to-day of the government and that was a big breakthrough," Mr Shorten said in an interview in Beijing, where he is part of a high-profile Australian delegation led by Prime Minister Julia Gillard.
"We separated the setting of the minimum wage, which still affects one and a half million people," he said. "Let's have a mechanism that takes some of the political capital incentive out of the game. That's the path we're heading down [and] that is genuine reform."
Treasurer Wayne Swan and Mr Shorten announced the proposed council on Friday and said they would ensure future changes were consistent with an agreed Charter of Superannuation Adequacy and Sustainability.
They said the charter would be guided by principles of certainty, adequacy, fairness and sustainability. Details will be developed through an intensive consultation process led by a charter group, to be established in coming weeks.
Mr Shorten's comments are the first to add some detail.
He said the proposal might require three years' notice of tax treatment changes or seven years to change the preservation age.
"You know people just hate changing goal posts, people hate inconsistency, people hate starting one plan and then doing another because the rules change retrospectively," he said. "I'm interested in what superannuation looks like in 2020 for 2040 and what superannuation looks like in 2030 for 2050.
"People say that the Hawke-Keating reforms were then, and now this is now, and it's all different," Mr Shorten said. "Independent monetary policy, independent superannuation policy, I don't think its any different."
Andrea Slattery, representing self-managed superannuation funds, said industry had long called for an independent body that would take policymaking away from short-term fiscal goals.
"We need a bipartisan system that can de-politicise superannuation policy," said Ms Slattery, chief executive of SMSF Professionals' Association of Australia.
She said the proposed council would strengthen the system and focus policymaking on long-term goals "if it's actually introduced".