The council’s own research also challenges the assumption in Treasury’s discussion paper that most members draw down the minimum.

It found that In the 2023–24 year, 63 per cent of sampled retirees from three large funds withdrew above the age-based minimum rates through regular pension drawdowns – a trend that was even more pronounced among those with lower balances and younger retirees, which could be linked to cost-of-living pressures.

SMC’s submission made nine key recommendations including making sure the Age Pension is recognised within the principles as a critical part of retirement income for most Australians.

Additionally, it called for better understanding that longevity products designed to help with managing longevity risk in retirement aren’t right for everyone and to allow trustees to design flexible retirement pathways for people with different needs from larger groups.

It also recommended the use of up-to-date information about members to group retirees in cohorts that reflect people’s situations and connecting retirement tools and advice with age. It urged the government to recognise that most retirees take out more than the minimum from their super, and lump-sum withdrawals are a normal part of retirement.

The submission said it is important to recognise that retirees may want to keep their super in an accumulation account for extra flexibility in being able to contribute or maintaining separate savings.

The SMC will release a major report next month with new evidence and modelling on retirement income dynamics, which will further support Treasury’s work on best practice retirement principles.

Georgia Brumby, SMC acting CEO said access to timely information, guidance and affordable financial advice is the other missing piece in the retirement puzzle, and the promised financial advice reforms must be urgently legislated.

"For many Australians, the retirement system is too complex which can be a barrier to decision making," she said.

“Hardworking Australians need access to simple information, guidance and advice to increase their confidence in the retirement solution that’s right for them,” she said.