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Government dodges super elephant

Government dodges the super elephant.
Superannuation tax breaks described by Australia Institute as the Hindenburg of the federal budget
AM, by James Glenday
Audio: Think tank wants big change to retirees’ benefits (AM)
“Superannuation concessions are unfair … the top 5 per cent of income earners get a third of the benefit, and the bottom 20 per cent get literally nothing.”

The report suggests scrapping concessions entirely, introducing a universal or non-means-tested age pension and upping the current rate by about 7.5 per cent to $26,273 a year for singles and nearly $39,611 for couples.

The Australia Institute says that plan would cost about $52 billion annually, leaving the budget between $13 billion and $22 billion better off. It says more money would flow to women and poor people.

“You often hear people say the more people spend on superannuation tax concessions, the more we save on the age pension,” Dr Denniss said.

“In theory that’s possible, but in practice it’s just not the case. If it were the case, the combined cost of these two schemes would be flat-lining.”

Furthermore, as the super assets are growing, and more and more frauds are reported, it will reach a point of “Too big too fail”, the government will pick up the tab, while most of the funds managers will walk away as multimillionaires.

The Australian government provides a safety net of the age pension to everybody of pension age and residential qualification, therefore if a “Self funded retirees” assets or income falls below the cut-off level of the age pension, he/she is entitled to a part-pension yet at the lower end of the pension scheme, a part-pensioner starts losing $0.50 of every dollar of the age pension, once a single pensioner earns $4,000 or a couple $7,000, keeping the retirees on very modest extra income virtually on the poverty line.
How can the Australian government get away with this blatant discrimination of the age pensioners; because Associations like COTA, ACOSS, SCOA, SA Superannuants, all other Associations affiliated with ACPSRO and the Unions fail to represent the interest of their lower income or wages members, because the leaders of this Associations benefit more from the governments generosity towards the high-income and assets benefits them in the same way as the politicians.

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