The Financial Services Council has cautioned the government against tinkering with superannuation, stating that superannuation changes are “not credible tax reform”.
Speaking in Sydney on Friday, FSC chief executive Sally Loane said superannuation must not be "raided" by the government to fill holes in the federal budget or to "fund pet projects".
"The national retirement savings policy – otherwise known as superannuation, has little to do with the tax system," Ms Loane said.
"Everyone knows we have a crook tax system. It is confusing, inefficient, costs Australian investment and jobs, and it reduces the incentives for many to work.
"You can tinker with super, but the truth is you will still have a broken tax system," she said.
Superannuation changes are "not credible tax reform", she added.
"Let’s be very clear: the gates have long been closed to stop people stuffing millions into super," Ms Loane said.
"Super was never designed as an intergenerational wealth transfer vehicle and should not be used as such."
Ms Loane also laid out the FSC's six-point plan for superannuation:
- give every Australian saver cast-iron confidence in the system;
- define its purpose and make it law;
- increase the superannuation guarantee rate to 12 per cent by 2022;
- encourage people to save voluntarily beyond the 12 per cent guarantee;
- provide tax concessions which give all Australians an incentive to save;
- increase the preservation age in line with increases in the age pension and life expectancy.
"If we follow this plan, new analysis by Rice Warner Actuaries demonstrates that the super system will achieve its objective – the present value of our age pension liabilities will be reduced by 60 per cent for middle Australia by 2050," Ms Loane said.
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