Superannuation, the ultimate government cash cow?

[qldfrog]

Absolutely non stop:
Too big a pile of money that any socialist consider theirs
Bloody capitalist boomers

Secret Treasury briefings reveal future of pension savings

Major superannuation funds would guarantee an annual income for millions of retirees under a confidential Albanese government proposal.

www.afr.com

Anyone with full access or full link?
Otherwise will wait till monday

 

[mullokintyre]

Absolutely non stop:
Too big a pile of money that any socialist consider theirs
Bloody capitalist boomers

Secret Treasury briefings reveal future of pension savings

Major superannuation funds would guarantee an annual income for millions of retirees under a confidential Albanese government proposal.

www.afr.com

Anyone with full access or full link?
Otherwise will wait till monday

The country’s major superannuation funds would guarantee an annual income for millions of retirees under a confidential proposal from the Albanese government as it prepares for a flurry of withdrawals from the super system.
While the pension pool has swelled to $4.1 trillion, the federal government and funds are increasingly assessing how to manage an inflection point when more money flows out of savings as a larger proportion of the population reaches retirement age and life expectancy grows.

More Australians are reaching retirement age, and living longer, putting more focus on withdrawals from the superannuation savings pool. Oscar Colman
In preparation, Treasury officials have circulated proposed standards to superannuation funds and industry bodies that would enshrine so-called longevity protection. This tool would set a draw-down rate for retirees with more than $200,000 in their account and would be difficult to change even if a person wanted to do so.
The document, obtained by The Australian Financial Review, says this would ensure a regular income “for a number of years (fixed term) or for the rest of [a member’s] life”.
“Common features may include regular payments that increase in line with inflation or in line with financial performance from a pool of assets,” the standards, currently in draft form, read.

Retail fund fears​

But the document, which outlines a voluntary standard, has attracted the ire of retail superannuation funds, which fear it will encourage people to avoid independent financial advice and remain with their default industry fund. More than $1.4 trillion of super is in industry funds, compared to $789 billion in their retail rivals, according to the sector.

Anti-hawking laws introduced after the Hayne royal commission to prevent unsolicited marketing and sales of financial products have limited the ability for super fund trustees to offer advice to members.

Funds can proactively contact members about their retirement, but cannot offer them specific products for that phase of life.

“I can’t see where this is heading except a prudential standard and regulations,” said a former Treasury official with knowledge of the process, who asked for anonymity, given the sensitive nature of the discussions.

Other people briefed on the proposal, who also spoke on condition of anonymity so they could discuss the confidential process, said they feared it would lead to a greater standardisation of super products when people actually needed more choice tailored to their requirements.


While the proposed measures would require funds to “support direct member choice”, offering them appropriate solutions based on “personas” that are developed with member data, retail funds are overwhelmingly sceptical that this would result in a diverse range of solutions for retirees.

The proposal would effectively mean that superannuation funds, to meet the government’s best practice criteria, must force an inflexible annuity product onto members in retirement even if it is not in their best interest.


The draft principles represent the latest effort by the Albanese government to manage the transition from the accumulation of superannuation to drawing down on savings as 2.5 million Australians prepare to retire over the next decade.

Laws that require funds to develop retirement income strategies came into force in 2022. Yet, a year later, the Australian Securities and Investments Commission and Australian Prudential Regulation Authority found retirees still did “not make the most of their superannuation assets”.

“As highlighted by the Retirement Income Review, many people die with the bulk of the wealth they had at retirement intact,” the regulators said then.


Outgoing Financial Services Minister Stephen Jones flagged the government would develop the retirement income principles late last year, and Treasury has circulated the draft to select industry figures over the past month.

One person briefed on the draft characterised it as a “pre-group” ahead of a broader public consultation likely to happen before the middle of the year.

Industry funds push for ‘one account for life’​

“No decisions have been made on the draft principles,” a spokesman for Treasurer Jim Chalmers said. “The government will consider Treasury’s advice and consult publicly before finalising them.”

Sources said the draft principles were reminiscent of submissions from industry funds, including the nation’s largest fund, AustralianSuper, to an earlier Treasury process where they advocated for “one account for life”.

“Members would reap significant benefits if a simpler system allowed one account for life for both the contribution and drawdown phases,” AustralianSuper wrote in its submission early last year, arguing it did not want members “hard defaulted” into a retirement income product, rather “the concept is that members can draw down when they are ready”.


The draft principles fall into three categories – “understanding members”, “providing quality retirement income solutions”, and “providing information and guidance”. Funds would be required, broadly, to use data to identify at least three cohorts of retirees, regularly review these cohorts, offer “tailored drawdown pathways” to members and provide easy to access information.

“The principles are intended to help trustees ensure members are appropriately supported to obtain good retirement outcomes,” the paper says.

“The principles are not exhaustive, and trustees may wish to develop and offer retirement income solutions that extend on the principles to provide exemplar product and service offerings to their members.”

Opposition financial services spokesman Luke Howarth said retirement was not a “one size fits all” problem.

“Any principles should flexibly support this objective and be focused on delivering choice, informed options, and the advice and advisers to deliver the best outcomes in retirement,” he said.

“Unfortunately, the Albanese government has moved at a snail’s pace on implementing meaningful financial advice reforms, which would help Australians entering retirement. 800 days have now passed since Michelle Levy handed the government her Quality of Advice Review final report.”
Mick

 

[qldfrog]

The country’s major superannuation funds would guarantee an annual income for millions of retirees under a confidential proposal from the Albanese government as it prepares for a flurry of withdrawals from the super system.
While the pension pool has swelled to $4.1 trillion, the federal government and funds are increasingly assessing how to manage an inflection point when more money flows out of savings as a larger proportion of the population reaches retirement age and life expectancy grows.
View attachment 193848
More Australians are reaching retirement age, and living longer, putting more focus on withdrawals from the superannuation savings pool. Oscar Colman
In preparation, Treasury officials have circulated proposed standards to superannuation funds and industry bodies that would enshrine so-called longevity protection. This tool would set a draw-down rate for retirees with more than $200,000 in their account and would be difficult to change even if a person wanted to do so.
The document, obtained by The Australian Financial Review, says this would ensure a regular income “for a number of years (fixed term) or for the rest of [a member’s] life”.
“Common features may include regular payments that increase in line with inflation or in line with financial performance from a pool of assets,” the standards, currently in draft form, read.

Retail fund fears​

But the document, which outlines a voluntary standard, has attracted the ire of retail superannuation funds, which fear it will encourage people to avoid independent financial advice and remain with their default industry fund. More than $1.4 trillion of super is in industry funds, compared to $789 billion in their retail rivals, according to the sector.

Anti-hawking laws introduced after the Hayne royal commission to prevent unsolicited marketing and sales of financial products have limited the ability for super fund trustees to offer advice to members.

Funds can proactively contact members about their retirement, but cannot offer them specific products for that phase of life.

“I can’t see where this is heading except a prudential standard and regulations,” said a former Treasury official with knowledge of the process, who asked for anonymity, given the sensitive nature of the discussions.

Other people briefed on the proposal, who also spoke on condition of anonymity so they could discuss the confidential process, said they feared it would lead to a greater standardisation of super products when people actually needed more choice tailored to their requirements.


While the proposed measures would require funds to “support direct member choice”, offering them appropriate solutions based on “personas” that are developed with member data, retail funds are overwhelmingly sceptical that this would result in a diverse range of solutions for retirees.

The proposal would effectively mean that superannuation funds, to meet the government’s best practice criteria, must force an inflexible annuity product onto members in retirement even if it is not in their best interest.

View attachment 193849
The draft principles represent the latest effort by the Albanese government to manage the transition from the accumulation of superannuation to drawing down on savings as 2.5 million Australians prepare to retire over the next decade.

Laws that require funds to develop retirement income strategies came into force in 2022. Yet, a year later, the Australian Securities and Investments Commission and Australian Prudential Regulation Authority found retirees still did “not make the most of their superannuation assets”.

“As highlighted by the Retirement Income Review, many people die with the bulk of the wealth they had at retirement intact,” the regulators said then.


Outgoing Financial Services Minister Stephen Jones flagged the government would develop the retirement income principles late last year, and Treasury has circulated the draft to select industry figures over the past month.

One person briefed on the draft characterised it as a “pre-group” ahead of a broader public consultation likely to happen before the middle of the year.

Industry funds push for ‘one account for life’​

“No decisions have been made on the draft principles,” a spokesman for Treasurer Jim Chalmers said. “The government will consider Treasury’s advice and consult publicly before finalising them.”

Sources said the draft principles were reminiscent of submissions from industry funds, including the nation’s largest fund, AustralianSuper, to an earlier Treasury process where they advocated for “one account for life”.

“Members would reap significant benefits if a simpler system allowed one account for life for both the contribution and drawdown phases,” AustralianSuper wrote in its submission early last year, arguing it did not want members “hard defaulted” into a retirement income product, rather “the concept is that members can draw down when they are ready”.


The draft principles fall into three categories – “understanding members”, “providing quality retirement income solutions”, and “providing information and guidance”. Funds would be required, broadly, to use data to identify at least three cohorts of retirees, regularly review these cohorts, offer “tailored drawdown pathways” to members and provide easy to access information.

“The principles are intended to help trustees ensure members are appropriately supported to obtain good retirement outcomes,” the paper says.

“The principles are not exhaustive, and trustees may wish to develop and offer retirement income solutions that extend on the principles to provide exemplar product and service offerings to their members.”

Opposition financial services spokesman Luke Howarth said retirement was not a “one size fits all” problem.

“Any principles should flexibly support this objective and be focused on delivering choice, informed options, and the advice and advisers to deliver the best outcomes in retirement,” he said.

“Unfortunately, the Albanese government has moved at a snail’s pace on implementing meaningful financial advice reforms, which would help Australians entering retirement. 800 days have now passed since Michelle Levy handed the government her Quality of Advice Review final report.”
Mick

Thanks Mick

 

[divs4ever]

Absolutely non stop:
Too big a pile of money that any socialist consider theirs
Bloody capitalist boomers

Secret Treasury briefings reveal future of pension savings

Major superannuation funds would guarantee an annual income for millions of retirees under a confidential Albanese government proposal.

www.afr.com

Anyone with full access or full link?
Otherwise will wait till monday

but , but ,but it is Government meddling and it's dishonesty about inflation AND the lack of remedies suggested by the Hayne Royal Commission , that is compelling the financially savvy ones to flee the super funds

the Government ( or super-fund managers ) controlling your super until you die ( and possibly grabbing the rest AFTER you die ) would send chills down the spine of many

you aren't the only horror story i have heard about retirees trying to access their own super , pulling teeth is much easier in some cases ( even the voluntary super funds that were taken out separately )

 

[divs4ever]

The country’s major superannuation funds would guarantee an annual income for millions of retirees under a confidential proposal from the Albanese government as it prepares for a flurry of withdrawals from the super system.
While the pension pool has swelled to $4.1 trillion, the federal government and funds are increasingly assessing how to manage an inflection point when more money flows out of savings as a larger proportion of the population reaches retirement age and life expectancy grows.
View attachment 193848
More Australians are reaching retirement age, and living longer, putting more focus on withdrawals from the superannuation savings pool. Oscar Colman
In preparation, Treasury officials have circulated proposed standards to superannuation funds and industry bodies that would enshrine so-called longevity protection. This tool would set a draw-down rate for retirees with more than $200,000 in their account and would be difficult to change even if a person wanted to do so.
The document, obtained by The Australian Financial Review, says this would ensure a regular income “for a number of years (fixed term) or for the rest of [a member’s] life”.
“Common features may include regular payments that increase in line with inflation or in line with financial performance from a pool of assets,” the standards, currently in draft form, read.

Retail fund fears​

But the document, which outlines a voluntary standard, has attracted the ire of retail superannuation funds, which fear it will encourage people to avoid independent financial advice and remain with their default industry fund. More than $1.4 trillion of super is in industry funds, compared to $789 billion in their retail rivals, according to the sector.

Anti-hawking laws introduced after the Hayne royal commission to prevent unsolicited marketing and sales of financial products have limited the ability for super fund trustees to offer advice to members.

Funds can proactively contact members about their retirement, but cannot offer them specific products for that phase of life.

“I can’t see where this is heading except a prudential standard and regulations,” said a former Treasury official with knowledge of the process, who asked for anonymity, given the sensitive nature of the discussions.

Other people briefed on the proposal, who also spoke on condition of anonymity so they could discuss the confidential process, said they feared it would lead to a greater standardisation of super products when people actually needed more choice tailored to their requirements.


While the proposed measures would require funds to “support direct member choice”, offering them appropriate solutions based on “personas” that are developed with member data, retail funds are overwhelmingly sceptical that this would result in a diverse range of solutions for retirees.

The proposal would effectively mean that superannuation funds, to meet the government’s best practice criteria, must force an inflexible annuity product onto members in retirement even if it is not in their best interest.

View attachment 193849
The draft principles represent the latest effort by the Albanese government to manage the transition from the accumulation of superannuation to drawing down on savings as 2.5 million Australians prepare to retire over the next decade.

Laws that require funds to develop retirement income strategies came into force in 2022. Yet, a year later, the Australian Securities and Investments Commission and Australian Prudential Regulation Authority found retirees still did “not make the most of their superannuation assets”.

“As highlighted by the Retirement Income Review, many people die with the bulk of the wealth they had at retirement intact,” the regulators said then.


Outgoing Financial Services Minister Stephen Jones flagged the government would develop the retirement income principles late last year, and Treasury has circulated the draft to select industry figures over the past month.

One person briefed on the draft characterised it as a “pre-group” ahead of a broader public consultation likely to happen before the middle of the year.

Industry funds push for ‘one account for life’​

“No decisions have been made on the draft principles,” a spokesman for Treasurer Jim Chalmers said. “The government will consider Treasury’s advice and consult publicly before finalising them.”

Sources said the draft principles were reminiscent of submissions from industry funds, including the nation’s largest fund, AustralianSuper, to an earlier Treasury process where they advocated for “one account for life”.

“Members would reap significant benefits if a simpler system allowed one account for life for both the contribution and drawdown phases,” AustralianSuper wrote in its submission early last year, arguing it did not want members “hard defaulted” into a retirement income product, rather “the concept is that members can draw down when they are ready”.


The draft principles fall into three categories – “understanding members”, “providing quality retirement income solutions”, and “providing information and guidance”. Funds would be required, broadly, to use data to identify at least three cohorts of retirees, regularly review these cohorts, offer “tailored drawdown pathways” to members and provide easy to access information.

“The principles are intended to help trustees ensure members are appropriately supported to obtain good retirement outcomes,” the paper says.

“The principles are not exhaustive, and trustees may wish to develop and offer retirement income solutions that extend on the principles to provide exemplar product and service offerings to their members.”

Opposition financial services spokesman Luke Howarth said retirement was not a “one size fits all” problem.

“Any principles should flexibly support this objective and be focused on delivering choice, informed options, and the advice and advisers to deliver the best outcomes in retirement,” he said.

“Unfortunately, the Albanese government has moved at a snail’s pace on implementing meaningful financial advice reforms, which would help Australians entering retirement. 800 days have now passed since Michelle Levy handed the government her Quality of Advice Review final report.”
Mick

HAH !

the only guarantee i would believe from a super fund now is , they will extract fees and charges for as long as they can ( including after death ) the Hayne Royal Commission scratched the surface sure , but how are the remedies going ?

and when will the next Royal Commission commence ( there must be still a few whistle-blowers left in that mess somewhere

 

[divs4ever]

HAH !

the only guarantee i would believe from a super fund now is , they will extract fees and charges for as long as they can ( including after death ) the Hayne Royal Commission scratched the surface sure , but how are the remedies going ?

and when will the next Royal Commission commence ( there must be still a few whistle-blowers left in that mess somewhere

by the way how would that 'income ' be calculated hopefully not the same way CPI is calculated

 

[sptrawler]

by the way how would that 'income ' be calculated hopefully not the same way CPI is calculated

Isn't that what happened under Menzies? Didn't all the retirement funds get rolled into consolidated revenue and pensions paid from that.
Or something to that effect?

History repeating? Lol

Members should read the early posts on this thread, nothing much changes, revenues dropping Govt chasing more plugs to stem the increasing revenue shortfall.