Kennedy distances Treasury from super drawdown compulsion

Mike Taylor

Managing Editor and Publisher

27 February 2025

The Federal Treasury has no desire to take away choice with respect to the way people draw down their superannuation balances, according to the Treasury secretary, Dr Steven Kennedy.

Asked to comment on reports of a Treasury discussion paper proposing to set draw-down rates for retirees with more than $200,000 in their account, Kennedy made clear that his view was that choices should be increased with respect to how retirees spent their superannuation, not the opposite.

Answering questions from Queensland independent senator, Gerard Rennick said he did not disagree with comments by the Senator about retirees being entitled to allocate their superannuation balances as they see fit.

“I don’t disagree with anything you said,” Kennedy said. “It is Important people have choice. And people may want to take super to retire debt.”

Kennedy noted that the chair of the Government’s Aged Care Financing Authority, Mike Callaghan had identified the importance of home ownership in post-retirement.

“We’ve engaged on the issue and the Government is concerned about people not being given all the choice they should around retirement products,” he said, observing that superannuation funds had tended to be more focused on accumulation than the retirement phase.

Kennedy said he believed policy-makers needed to be very careful about removing choice.

“I do wonder whether this is an area where at least some nudging is required,” he said.

Kennedy said that Treasury was really testing the hypothesis of people being confident to access money they had put aside for retirement.

“It’s not about taking away choice. It’s about people being offered enough choice,” he said.