The Australian government is seeking public input on its national pension system, which it said had been abused by the previous administration.
“Our superannuation system is the envy of the world,” Australian Treasurer Jim Chalmers said in a release. “But the last decade has seen the former government raid the superannuation system for their own purposes – with devastating impacts on Australians’ savings.”
The administration of Prime Minister Anthony Albanese, elected in May 2022, says it took the next step toward passing pension legislation on Monday, when it released a consultation paper seeking input from Australians about the benefits, phrasing and implementation of an objective for the retirement system.
The administration noted that there is currently no agreed objective of superannuation—legislated or otherwise—to help guide policymakers, regulators, industry and the wider community.
“We need to change that,” Chalmers said.
Chalmers said that because the number of Australians entering retirement age is rising, there should be a greater focus on delivering strong retirement outcomes for its citizens.
“Superannuation is an increasingly important source of capital in our economy and the significant scale of Australia’s superannuation system contributes to the strength of our financial markets through capital deepening,” Chalmers said in the statement.
The size of Australia’s retirement system has grown significantly over the last 30 years from approximately A$148 billion in 1992 to more than A$3.3 trillion. It also now represents 139.6% of gross domestic product and is projected to grow to approximately 244% of GDP by 2061.
The consultation paper outlines the government’s proposed definition of the objective, which is “to preserve savings to deliver income for a dignified retirement, alongside government support, in an equitable and sustainable way.”
The paper provides context about the history of Australia’s superannuation system and the rationale for seeking a superannuation law, then offers options on potential framing. It also aims to show how a legislated objective could improve accountability and transparency in policy development.
According to the government, superannuation legislation will provide stability and confidence to policymakers, regulators and the industry, and proposed changes to superannuation policy will be aligned with the purpose of the superannuation system.
“There is a significant opportunity for Australia to leverage greater superannuation investment in areas where there is alignment between the best financial interests of members and national economic priorities, particularly given the long‑term investment horizon of superannuation funds,” Chalmers said.
Digital and mailed submissions in response to the consultation paper close on March 31.
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Tags: Australia, consultation paper, Jim Chalmers, Legislation, Pension, Pension Reform, Pension system, Superannuation