The Albanese government wants to make it easier for superannuation funds to provide advice to workers approaching retirement, Assistant Treasurer Stephen Jones says.
Existing rules are restricting what information funds can provide to workers developing financial strategies, Mr Jones said.
It’s “almost impossible” for funds to meet their obligations to help members plan for retirement, he said, and flagged “legislative nudges”.
“The existing rules even make it difficult for funds to ask some pretty basic questions and provide some pretty basic information,” Mr Jones told an Industry Super Australia (ISA) forum in Melbourne on Thursday.
“We’ve got to sort through some of those things … the government gets the problem and doesn’t think the status quo is going to fix it.
“Australians have got to have access to better info and advice, and there’s probably also a role in all this … [for] some legislative nudges.”
The government is considering recommendations from a recent financial advice review that called for super funds to be allowed to commit resources to providing personal advice to their members.
Mr Jones would not be drawn on Thursday about the government’s response to that review, but said he hoped “to be in a position in the near future to provide a formal response on some of those things”.
There were only 16,000 licensed financial advisers to help a fast-rising number of Australians closing in on retirement – “the numbers don’t square”, he said.
Citing an example of Australians having poor access to information and advice about their super, Mr Jones said “an extraordinary number” of Australians over 65 haven’t shifted their super into its retirement phase.
It means they’re still paying tax when they otherwise wouldn’t, he said.
“That’s good for the tax revenue of the country, but it’s not necessarily in the best interest of that individual,” Mr Jones said.
“I suspect one of the reasons they’re still in the accumulation phase is they’ve not had any information or advice which tells them how they can make that money work for them better.
“There’s just really simple things that I think we should be able to do to meet that objective of retirement.”
Paid parental leave super
Mr Jones was also quizzed on Thursday about whether the government would add super to paid parental leave.
He said the government “will do it” but that “headroom” must be found in the federal budget to fund such a change.
“We looked at it in our first budget [last October] and decided the priority we wanted to put in place then was the commitment we put in place to extending paid parental leave payments [to six months],” he said.
Mr Jones said that closing the gender-based superannuation pay gap goes far beyond super policy and primarily concerns closing the wider gender wage gap across the economy and also career breaks.
“The most powerful levers we have to pull down on to address the superannuation pay gap actually lie outside of superannuation,” he said.
The New Daily is owned by Industry Super Holdings
