Super Basics – Save our Super – Federal May Budget Super changes: unfair, unreasonable and undermine trust?

Super Basics – Save our Super – Federal May Budget Super changes: unfair, unreasonable and undermine trust?

Super Basics – Save our Super – Federal May Budget Super changes: unfair, unreasonable and undermine trust?

Jack Hammond, Melbourne QC, says the Federal May Budget Super changes are unfair, unreasonable and undermine trust in the Government. He has begun a campaign and petition – “Save our Super”.

On his site he says –

The proposed changes to superannuation rules would cause millions of Australians who are effectively compelled by the Australian compulsory superannuation scheme to place their trust in the government” to lose their faith in the system.

Certain of the proposed changes are manifestly unfair, unreasonable and undermine trust in government if they are not grandfathered.

Unfair and Unreasonable

It is manifestly unfair and unreasonable to individuals who now, or will, rely on their superannuation savings for a retirement income to make new rules which significantly affects them by penalising their actions taken in good faith, encouraged by the Government, under the then existing rules.

Therefore, appropriate grandfather clauses need to be put in place to protect all affected Australians.

Undermines Trust

A Government’s right to govern is based upon the bond of trust between the people and their Government. Trust is the currency of Government. When, by a breach of trust, a Government debases that currency, the people lose confidence in their Government.

And so it is when Governments make major rule changes to an existing superannuation system. If, as above, as a consequence, they penalise actions people had taken based on the then existing rules, without also providing grandfather clauses, Australians will lose faith in the superannuation system.

Those who will lose faith include the millions of Australians who are effectively compelled by the Australian Compulsory Superannuation Scheme to place their trust in the Government.

Furthermore, those who are yet to enter the superannuation system need to be assured, before they commit their savings to the superannuation system, that they can trust Governments to always treat them fairly and reasonably.

Superannuation – A Long Term Savings Plan Under Threat

Australians’ investment in superannuation is an almost life-long savings plan. It starts from the first superannuation contribution and lasts until the final pension payment.

In 1991, the Superannuation Guarantee levy was imposed. Australian’s participation in superannuation has accelerated from about 30% of employed persons to over 90% today.

Since the 1980s, Australia’s accumulated superannuation savings have risen from an amount equivalent to about 30% of GDP to about 120% of GDP today.

Over time, as more Australians contribute more super funds for longer proportions of their working lives at higher rates, average superannuation balances at retirement should continue to rise.

However, that growth is threatened if appropriate grandfather clauses are not included in superannuation legislation.

How have the proposals appeared to you? What do you think?

To find out more or to sign up for the petition, go – http://saveoursuper.org.au/

SuperBenefit works with SMSF trustees to CONNECT them with the advisors they need. A call is FREE. If you have any questions, why not give us a call – it’s FREE!

No obligation. 0407 361 596, Paul.

What are your thoughts? Start or continue the conversation here!

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