The Association of Superannuation Funds of Australia (ASFA) supports the government’s revised superannuation package announced this morning and urges the Parliament to pass the changes as soon as practical, in order to provide certainty for people saving for their retirement.
The revised superannuation package drops the controversial $500,000 lifetime non-concessional cap on fund balances, backdated to 2007, which was unveiled in the initial package by the treasurer in his May 3 budget.
Among other changes in the $6 billion savings package, those aged under 65 will still be able to “bring forward” three years’ worth of non-concessional contributions but those with super balances of more than $1.6 million will not.
ASFA interim CEO Jim Minto said the package makes the superannuation system more sustainable.
“The key message for savers is that they should have confidence in their super,” he said.
“We are delighted that people approaching retirement will have more flexibility to add to their super.
“ASFA has long advocated for both a lifetime cap on non-concessional contributions and a limit on the total amount tax free in retirement. The revised superannuation proposals address both issues.
“The primary role of superannuation is to provide income in retirement and it should not be used as an estate planning tool.
“The ceiling of $1.6 million, once it is legislated, balances the need to ensure enough income for a comfortable retirement with ensuring the level of tax concessions is sustainable in the future.
“This is the responsible thing to do for the superannuation system and for Australia’s long term, fiscal sustainability,” he concluded.
In the meantime, here are ASFA’s tips on making your super work for you.
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