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Super changes are fair but confusing, say seniors

Superannuation changes are broadly fair but have been poorly communicated, says the consumer lobby for the over 50s. Australians are still grappling with what the changes – from the $1.6 million tax-free limit to the $10,000 reduction in the concessional cap - will mean to them.

“National Seniors believes the super changes are fair,” says National Seniors’ chief advocate Sarah Saunders.

“Generous top-end concessions represent money better spent in areas like health and aged care. But rushing straight from the May budget to the noise of an election campaign was not the ideal way to ‘sell’ them. People have had very little time to unpack the changes and there's been a lot of confusion,” Ms Saunders says.

“We welcome the rollover of concessional caps and widening access to partner contributions, and the $1.6 million tax free cap is reasonable.”

Ms Saunders continues that there has been some angst over the reduced concessional contributions caps, particularly from women returning to work late in life who use these to build their savings.

“Ultimately, it's important to have certainty around the retirement income system and changes should be careful, open to discussion and not driven from a single quarter. It's only fair that people who’ve planned, based upon a particular set of rules, have time to adjust, otherwise confidence in the entire system is undermined.” she says.

A more worrying issue amongst older Australians is the pension asset change, due to take effect from January 2017.

“Combined with historically low interest rates, the assets change will see self-funded retirees near the thresholds living off less than a full pensioner,” Ms Saunders says.

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