Frydenberg flags super freeze
Treasurer Josh Frydenberg has weighed in on the superannuation debate in the clearest sign yet that the government may be considering a freeze to the legislated increase.
In a speech at the National Press Club, Treasurer Josh Frydenberg echoed the findings of the Retirement Income Review (RIR) and said that 9.5 per cent superannuation was enough to provide an adequate standard of living in retirement.
“This is why, as the Prime Minister and I have said, we must rightfully and carefully consider the implications of the legislated increase to the superannuation guarantee before the 1st of July this year. This is even more important as we are in a time when our economy is recovering from the largest economic shock since the Great Depression,” Mr Frydenberg said.
The RIR found that there is a trade-off between wages and superannuation, with a median earner approximately $32,000 worse off over the course of their working life.
While the Morrison government has so far shied away from using the findings to freeze the increase, Mr Frydenberg said that he would “remain sceptical of those who, in the pursuit of their own interest, seek to restrict the legitimate choices Australians should have to save for their retirement”.
“It is simply not true, as some would have us believe, that there is not a limit to how high the superannuation guarantee can be increased in the name of delivering even higher retirement incomes,” Mr Frydenberg said.
“For some, there isn’t a problem that cannot be solved through higher rates of contribution to superannuation. These myths do not help Australians plan for retirement, or feel more confident and more secure in their retirement.”
Mr Frydenberg also called on funds to create new products and guidance that would allow retirees to spend their super more effectively, noting that many passed away without spending the full amount.
“This is despite the fact that retirees today have not benefited from the superannuation system their whole working life. The review shows that, if nothing changes, by 2060 one in every three dollars paid out of superannuation will be as part of a bequest,” Mr Frydenberg said.
Lachlan Maddock
26 February 2021
smsfadviser.com
Latest eNewsletters
Hot Issues
- Div 296 sparking death benefit discussions
- ATO warns SMSF trustees to be aware of increase in scams
- Roles and Responsibilities in a Business Partnership
- Beware of tax implications for failing to meet minimum pension requirements: consultant
- Leasing property owned by an SMSF
- A super contributions deadline you won’t want to miss
- How topping up your super each year could leave you $80,000 better off in retirement
- Evolution of Boeing - 1916 - 2025
- ATO issues guidance on SMSF trustee appointment and compliance
- ASIC to increase audit surveillance in 2025–26
- Investment and economic outlook, May 2025
- Legal case has succession planning lessons for SMSF members, advisers: legal expert
- Your 30 June superannuation checklist
- Start-ups to suffer under Div 296
- New SMSF trustees propel uptake of financial advice
- Comparison of various Animal Weight
- $95bn loss predicted to Australian economy if Div 296 passes: analysis
- Why more Australian SMSF owners are looking to global equities
- Investment and economic outlook, April 2025
- Trustees reminded of minimum pension drawdown
- How boosting your super can help you reduce your tax bill
- Are your adult children ready for the wealth transfer?
- Financial abuse move now a certainty
- Freshwater Resources by Country 2025
- Investment and economic outlook, March 2025
- Advisers should be aware of signs of elder abuse in SMSF structures
- SMSFs hold record levels of cash and property
- Trustees warned on early access
- The Largest Empires in the World's History