Just over a year after the Treasurer, Peter Costello outlined the Government’s landmark retirement incomes policy, the Assistant Treasurer, Mal Brough has released the regulations which underpin key elements of that policy.
Brough on Monday released the Government’s transition to retirement regulations which, from July 1, will allow people who reach retirement age to keep working but access a portion of their superannuation via an income stream.
Announcing the move at an Investment and Financial Services Association (IFSA) luncheon in Sydney, the minister said the initiative represented the removal of an artificial barrier.
“This initiative will provide more options for people making the transition from work to retirement,” he said. “For example, a person can continue working part-time and use part of their superannuation to supplement their income.”
Brough said that in designing the regulations, the Government had been careful to provide maximum flexibility for individuals while minimising complexity.
He said this had meant there was no work test, no capping of the amount of benefits a person could access and allowing individuals to use existing pension products .
“Under the policy, allocated pensions can be commuted and cashed out as lump sum while a person is still working,” Brough said. “However, once a person retires or reaches age 65, they will have the option to commute the allocated pension and access their full benefits.
The Government’s announcement was welcomed by the chief executive of IFSA, Richard Gilbert who said they would give much more flexibility to the increasing number of Australians who would find themselves somewhere between fully engaged in the workforce and fully retired.
“These regulations will help them plan and manage their work/life balance far more easily,” he said.
