Allow funds to automate Age Pension applications says AustralianSuper
Australia’s largest industry superannuation fund, AustralianSuper, is advocating the Government implementing Australians having the same superannuation account for life and allowing super funds to automate Age Pension application.
The big super has advocated the changes as part of its submission responding to the Treasury discussion paper on released in early December seeking views on “how the superannuation system can best provide the security an income Australians need as they live longer and healthier lives in retirement”.
The AustralianSuper response not only canvasses the “account for life” approach and the integration of the Age Pension but also recommends:
- Changes to the tax structure to allow people to draw an income over preservation age and recontribute to their superannuation savings if they choose to work.
- Changes to enable super funds to provide more support, advice and guidance, leveraging data sharing with Government to smooth the complexity of retiring.
- Making advice laws technology neutral to leverage the potential of AI and other technologies, with the appropriate protections.
Discussing the submission, AustralianSuper’s Chief Officer Retirement, Shawn Blackmore, said that a cultural shift was taking place around how people define ‘retirement’.
“Many AustralianSuper members are telling us that they want flexibility and simplicity in the retirement income system as they define what retirement looks like for them and have confidence as they enjoy the next stage of their lives,” he said.
Blackmore said members wanted to know they have enough to retire, and to be able to take a holistic view of their retirement income from different sources, including the Age Pension.
“Around 62% of Australians aged 65 and over currently receive full or partial government pension payments, demonstrating the extent of the challenge,” he said. “Research suggests less than half of people apply for the Age Pension immediately when eligible, with many members missing out on their full Age Pension entitlement by delaying their application.”
“Having a simple, seamless and most importantly, integrated, system in retirement, as they do in accumulation, will help retirees to navigate these changes with confidence.”
“Retirement is deeply personal. There is no one size fits all, as each retiree has their own wants, needs and expectations of this important phase of their life.
“It’s important we listen to superannuation members and seek to understand their changing needs, and in response develop holistic solutions which not only build the adequacy of their savings but also their confidence to spend these savings to improve their standard of living during retirement.’”
Blackmore said funds like AustralianSuper were ready to provide a more personalised, simplified and technology-driven approach to retirement.”