Chalmers says Intergenerational Report shows super puts Australia head of the pack in containing pension spending
Jim Chalmers on Wednesday will release projections from the government’s Intergenerational Report to bolster Labor’s argument against One Nation’s Super proposal.
Treasurer Jim Chalmers is set to release an Intergenerational Report (IGR) on September 21, aiming to support Labor's stance against One Nation's proposal to allow individuals to access some of their superannuation savings. Chalmers emphasizes that this report will be a pivotal moment in the upcoming federal election, as the compulsory superannuation scheme faces its greatest challenge since its introduction by the Hawke-Keating governments.
The IGR projects that the number of Australians over the age of pension eligibility will almost double to about nine million by 2066. However, the percentage of this age group receiving pension or income support payments is expected to decline from 66% in 2022 to 52% by 2066. Consequently, spending on age and service pensions is projected to decrease from 2.3% of GDP in 2022 to 1.8% in 2066.
Chalmers asserts that superannuation is crucial in ensuring that Australia outperforms other developed nations in managing pension spending while simultaneously boosting retirement incomes. According to projections, spending on pension-related services will be significantly lower in Australia compared to the United Kingdom (10%), Canada (8%), New Zealand (7%), and the United States (6%).
The $4 trillion superannuation pool is projected to contribute to growth in foreign income inflows, bolster gross national income, and strengthen international relationships. Although superannuation enhances retirement incomes, it also helps reduce reliance on the pension, reinforcing our capital markets.
Chalmers underscores that compulsory superannuation, with preservation at its core, is currently facing its most significant threat since its inception. One Nation's proposal, along with support from certain Coalition members, would fundamentally alter the system, potentially leaving millions of workers worse off in retirement. Chalmers warns that a median full-time worker could see their retirement income reduced by $25,000, while a couple might be more than $50,000 worse off.
He argues that such a decision would jeopardize fiscal sustainability, higher living standards, and economic growth supported by a robust and mature superannuation system.
Written by urgent.news from The Conversation AU's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
