ABA WELCOMES ABOLITION OF SUPERANNUATION SURCHARGE

Sydney, 11 August, 2005: The Australian Bankers’ Association (ABA) has welcomed the Coalition’s abolition of the superannuation surcharge, which yesterday passed through the Senate.

David Bell, Chief Executive of the ABA, said: “This sound Government policy reform is likely to encourage higher additional voluntary superannuation contributions; an important incentive for growing personal savings, increasing retirement incomes and improving Australians’ standard of living in retirement.”

“Public policy initiatives in superannuation must continue to concentrate on adequacy, simplicity and literacy to encourage Australians to plan and save for their retirement.”

“The reason for this emphasis is that a gap still exists between the aspirations and expectations of Australians’ standard of living in retirement and what the current system will actually deliver.”

The effect of the abolition of the superannuation surcharge will be of interest to the House of Representatives Standing Committee on Economics, Finance and Public Administration which is inquiring into improving superannuation savings of people under 40.

The ABA will lodge a submission to this Inquiry and expects to appear before the committee to outline the banking sector’s views.
 
Notes for editors:
The superannuation surcharge was a surcharge imposed on superannuation contributions, once income reaches certain thresholds. The 15% surcharge was introduced in the Budget in 1996. It was reduced to 12.5% and fell to 10% in July this year.

The Federal Government announced in this year’s Budget that the superannuation surcharge would be abolished from contributions and termination payments made or received from 1 July 2005.

For further information:

Heather Wellard
Director, Public Relations
Phone: 02 8298 0411
Mobile: 0409 830 439

ENDS