Pollies and bureaucrats off the hook on super
The Federal Government has been warned that it will need to rethink some elements of its Budget superannuation package in circumstances where long-serving politicians and senior public servants appear to have emerged unaffected by changes to the contribution caps for high-income earners.
The apparent oversight was acknowledged by Deloitte superannuation partner John Randall, who said that in the interests of equity among higher income earners, the burden needed to be shared by everyone.
The only acknowledgement of the problem in the Budget is to grandfathering arrangements that apply “to certain members with defined benefit interests as at 12 May, 2009, whose notional taxed contributions would otherwise exceed the reduced cap”.
The problem confronting the Government is that public servants and others are enjoying contributions of as much as 22 per cent to their superannuation, compared to the standard 9 per cent provided by the superannuation guarantee and then topped up by people in defined contribution schemes.
Other industry spokesmen suggested that if politicians and senior public servants were appropriately wrapped up into the same arrangements as those applying to other high-income earners, it could add substantially to the Budget savings extracted from the measure.
The Government is expected to come under pressure in the Senate to address the anomaly.
AUTHOR
Mike Taylor
Recommended for you
Licensee Centrepoint Alliance has completed the acquisition of Brighter Super’s annual review service advice book, via Financial Advice Matters.
ASIC has launched court proceedings against the responsible entity of three managed investment schemes with around 600 retail investors.
There is a gap in the market for Australian advisers to help individuals with succession planning as the country has been noted by Capital Group for being overly “hands off” around inheritances.
ASIC has cancelled the AFSL of an advice firm associated with Shield and First Guardian collapses, and permanently banned its responsible manager.
