Keating slams contribution caps

Fourteen years after leaving office, former Prime Minister Paul Keating has again waded into public debate, criticising the Government for its decision to reduce concessional contributions to $25,000 for those younger than 50, describing it as a “dreadful decision”.

Speaking on ABC radio, Keating said while the Rudd Government deserved to be re-elected for its economic management alone, the decision to cut the superannuation concessional contribution rate in half and increase the age pension were decisions that were sending the wrong message.

“So if you're a punter out there you say, 'Look, the Government's given me the message: Don't bother saving any more. We'll just rely on the pension.'”

Of the decision to cut concessions, he said: “They should reverse it, quickly. You know, shocking decision in my opinion. Short-sighted. Bad.”

Keating also offered the hint that there might be some division within the Government on superannuation policy. He said he knew lifting the superannuation guarantee to 12 per cent from 9 per cent was something Treasurer Wayne Swan and the Superannuation Minister, Chris Bowen, were interested in.

“It's their job I think to convince the Prime Minister that there's a good economic case and all good economic reasons for taking the 9 per cent to 12,” he said.

But despite his criticism of the Government on superannuation policy, Keating saved his most venomous attack for the Opposition leader, calling Tony Abbott an “intellectual nobody”, and of the Opposition he said, “You wouldn't trust this mob with a jam jar full of five cent bits”.