Government comes clean on super

National Seniors has welcomed the government coming clean on its superannuation plans but says the concessional cap increase has fallen short of expectations.

Last week the government announced around 16,000 people would be affected by the super changes which will tax super balances around $2 million and over.

“Speculation that retirement savings would be raided to prop up the budget has created nervousness amongst older Australians,” said National Seniors chief executive Michael O’Neill.

“We welcome that the changes are not retrospective and that grandfathering applies to some of them”.

“The $100,000 retirement phase tax-free earnings threshold which equates to a super balance of around $2 million appears fairly generous”.

However, O’Neill said the concessional cap increase to $35,000 had fallen short of expectations.

“The $10,000 increase in the $25,000 superannuation concessional cap for people aged 60 and over is welcome.

“But it is still $15,000 short of the $50,000 cap average earners had counted on last year and the government had promised for 2014”.

The cap, which had been halved in 2011, and extended for two years, had been expected to increase to $50,000 in 2014 for people aged 50 and over.

“To avoid a repeat of this type of politicised speculation, future debate must occur within a wider, transparent, cross-portfolio retirement incomes strategy,” he said.

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