Top earners with “excessive” concessions in Swan’s firing line for super changes

Speculation over the federal government’s plans for superannuation have continued, with Treasurer Wayne Swan yesterday confirming any upcoming changes will target Australians earning over $300,000 a year.

The declaration comes as the government is said to be considering announcing any changes before the May budget.

Speaking at a press conference in Canberra yesterday, Swan said current tax concessions for the “very top” income earners were too generous.

“Everybody understands that the system must be sustainable for the long term, that tax concessions for those at the very top are excessively generous and to make it sustainable over time the concessions need to be sustainable over time,” he said.

“We want to see more Australians having access to a decent retirement with a decent level of support from their superannuation,” he said.

Swan refused to respond to speculation changes would only impact the top 2% of income earners, but he did argue the reforms were not going to be a “savings task in itself for the budget”.

Swan said the changes were to be “in the spirit of reform that we saw during the period of the Hawke and Keating governments”.

However, critics argue the government is attempting to mask its efforts to put the budget back in surplus.

Superannuation Minister Bill Shorten was also vocal about superannuation changes yesterday as he addressed unions, industry bodies and superannuation experts at the sixth annual super roundtable.

“The fact is Australians are living longer and they will need to be encouraged to have adequate savings to retire comfortably.

“Our superannuation system needs to be fair, consistent, stable and it needs to be sustainable in the long term,” Shorten says.

The government has been facing increasing pressure from industry personnel and the public over the supposed changes.

Association of Superannuation Funds of Australia chief executive Pauline Vamos told SmartCompany yesterday the debate was misinformed and had turned “hysterical”, but agreed superannuation needs to be adjusted to account for people living longer.

In last year’s budget it was announced the superannuation contributions tax rate for taxpayers earning over $300,000 would be increased from 15% to 30%.

According to the research by the Australian Bureau of Statistics released last year, the average amount of money in an accumulating superannuation account for males was $87,589 and for females it was $52,272.

An aggregate of statistics by the ASFA for February 2013 indicated 66% of retirees aged over 45 relied on government pensions as their main source of income.