IPA calls for post-election restraint on super

In the wake of the Federal Election, the IPA has urged the Government to reconsider previously announced policy changes, namely a lifetime cap of $500,000 on non-concessional contributions and their retrospective application.

“Successive governments have encouraged citizens to provide for their own retirement but retrospective policy changes have made many people feel anxious,” said IPA chief executive officer, Andrew Conway.

“The lifetime cap of $500,000 on non-concessional contributions backdated to 1 July 2007 and the cap of $1.6 million on pension-phase balances have significantly shifted the goalposts," Mr Conway added.

According to Mr Conway and the IPA, the small impact of the changes do not serve as a justification for backdating.

“The impact on people’s long term financial savings to fund 30 years of retirement defeats the purpose of what superannuation was meant to address."

Mr Conway insisted that Governments should take superannuation out of the budgetary cycle and not 'tinker' with people’s self-sustainable retirement plans.

“Once the mandated purpose for superannuation is determined and agreed upon, the Government should then look towards making changes for the long term instead of using superannuation to plug a hole in the budget deficit. The IPA continues to urge the Government to address structural problems with the budget through holistic tax reform."

“Wealth creation strategies outside of superannuation used to fund retirement should also be considered as part of a broader review of retirement incomes policy," said Mr Conway.