Financial Standard Comments - Plug the $1 trillion savings shortfall: FSC

Comment by Phil . (.)

Phil . (.) — Tue, 04 Sep 2012 13:32:00 +1000

The life expectancies quoted here understate the problem. We should be looking at residual life expectancy at age 65 instead of life expectancy at birth. For those aged 65, men can expect on average to live to 83.9 years and women 86.8 years.

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Comment by John Haster (John Haster)

John Haster (John Haster) — Tue, 04 Sep 2012 16:18:31 +1000

Can anyone explain to my the thinking behind the decision to stop people contributing to superannuation after age 75?
I am referring to undeducted personal contributions.
Why not allow people who wish to, and are able to make contributions after age 75 to do so. Put a total limit on the balance attainable.
A possible balance of $1 Million and perhaps do not make the contributions tax deductable.
There are people who have suffered a set back and are at a late age able to recover from that set back. Perhaps they have a business or a property to sell. Why not allow a CGT Excempt contribution?
Why have a cut off date at all?
Please explain.

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Comment by David Williams (My Longevity Pty Limited)

David Williams (My Longevity Pty Limited) — Tue, 04 Sep 2012 16:26:10 +1000

Congratulations to the FSC for following up on the IMF's report on this subject in April this year. While increasing the age of access to superannuation funds is an important issue, as Pauline Vamos reminds us a significant group of the community simply cannot continue in employment as they age. Blanket rules on access based on age alone may be found wanting and may even be found to be discriminatory by the Australian Law Reform Commission's current review on this topic. The ALRC report should at least foster more debate on this issue.

The IMF report suggests that a solution may lie in a much more dramatic increase in the formal age of access to the Age Pension. Given that people on average live at least ten years longer from age 65 than they did 100 years ago (when the access age was set) it defies logic that we only incrementally are increasing this age to 67.

There are many perspectives on this issue to be explored and debated. It's good to see private enterprise taking the lead as Governments don't seem to have the resolve to tackle these really hard questions and seek genuinely strategic solutions.

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Comment by Sue Allen (Radford Allen Financial Services Pty Ltd)

Sue Allen (Radford Allen Financial Services Pty Ltd) — Wed, 05 Sep 2012 10:34:45 +1000

So, when is the Govt going to scrap all taxes on superannuation? This would result in an immediate boost to contributions by 15%, and an annual boost to superannuation earnings by 15%.

Problem solved.

Now all they have to do is work out how to balance the budget the way the rest of the community does, by matching expenditure in the current period with income actually earned in the current period ( instead of taxing future wealth as the superannuation taxation regime does.)

Maybe we would all have to stop living outside our means.

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