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The impact of the superannuation means test on the average worker …

January 18th, 2015 Leave a comment Go to comments

 

The problem with the Australian superannuation system, is, that even after a working- lifetime of contribution, the majority of retirees will still depend for a large part of their retirement income on the age pension, and being held close to the poverty line, by the means test of the age pension, while the self funded retirees will live in opulence.

… in my humble opinion, it would be very appropriate if a much watched and noted program like Four Corners would bring the “Great Australian super fraud” to the attention of the general public.


Thank you for the letter of the 15 December 2014 written on your behalf by Kirstin McLiesh.

In the letter it is stated that Four Corners has covered the issue of superannuation in the past, yet as a regular viewer of Four Corners for years, except if on holidays, which is not often, I cannot recall that Four Corners has devoted a full program on superannuation, nor find it on your website http://www.abc.net.au/news/topic/superannuation.

If there is anything mentioned about changes to superannuation in the media the super industry immediately jumps to the defence of SMSF’s, the retail super and the industry super.

Now the ACTU should look after the Union members, which will never accumulate enough assets or income to be independent of the Centrelink pension and will be greatly affected by the means-test of the pension, yet they are compelled to compulsory super, and many of the super and ACTU leaders are on industry super boards, being well-paid for it, never to be dependent on any age pension, therefore not be affected by the means-test of the age pension, yet they are only looking after their own interest.

There are other organizations like the “SA Superannuants” of which I have been a member for some 15 Years, there is SCOA (Superannuated Commonwealth Officers’ Association, ACPSRO – The Australian Council of Public Sector Retiree Organisations) and its affiliated Associations, which should look after the interest of the members on low government super, being dependent on a large part of their retirement income from the age pension and therefore affected by the means test of the age pension, yet the leadership of these Associations only represent the small number of their members which are self funded retirees, while the income for the Associations comes mainly from members which are very much affected by the means test of the age pension.

The problem with the Australian superannuation system, is, that even after a working- lifetime contribution, the majority of the retirees will still depend for a large part of their retirement income on the age pension, and being held close to the poverty line,by the means test of the age pension, while the self funded retirees will live in opulence.

Yet will it be sustainable, while the cost of the tax concessions for super equals or exceeds the cost of the age pension?

I have written many letters to MP’s and have received many replies, which always hark back of the sustainability of the age-pension, yet are tax concessions for self-funded retirees sustainable?

I once told Mr. Alexander Downer, when he was my MP of Mayo, that I made the mistake of migrating to Australia 55 years ago and not returning to my country of origin, after my two-year contract expired, and all he could reply, was, “I’am sorry to hear that”.

I, and many of my generation have been robbed of a decent standard of living in retirement by the means-test of age pension, while paying very high tax rates throughout our working lives and the age pension is paid out taxes.

In ABC AM  episode “Government dodges the super elephant” by James Glenday refers to superannuation tax breaks described by Australia Institute as the Hindenburg of the federal budget. Think tank wants big change to retirees’ benefits.

“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.”

What James Glenday wrote as above, was also reported by the ABC radio, but it was quickly forgotten, therefore, in my humble opinion, it would be very appropriate if a much watched and noted program like Four Corners would bring the “Great Australian super fraud” to the attention of the general public.

Yours truly,
Hawil

Written to:
Australian Broadcasting Corporation
c/o Managing Director: Mark Scott
ABC Ultimo Centre,
GPO Box 9994,
Sydney NSW 2001,

28December 2014

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