ABA WELCOMES BUDGET INITIATIVES FOR SUPERANNUATION AND BUSINESS TAXATION Intergenerational report raises need for long-term reform goals Sydney, 14 May, 2002: The Australian Bankers’ Association (ABA) welcomes the 2002-03 Budget for the implementation of some important initiatives aimed at improving the Australian superannuation system. David Bell, Chief Executive of the ABA, said: “There are a number of welcome initiatives in tonight’s budget and we are pleased to see the range of superannuation offerings.” In summary, the key superannuation initiatives commended by the ABA are: Benefits for low-income earners and higher fully deductible contribution limit for the self-employed; Superannuation surcharge to fall; Requirement for payment of Superannuation Guarantee to be made at least quarterly;  Splitting of contributions between couples;Allowing baby bonus to be contributed to a superannuation fund. Mr Bell said: “The Intergenerational Report emphasises the importance of the Government taking early decisions on adequacy and how, in particular, contributions can be increased.” “The initiatives announced tonight are a positive first step but the longer the adequacy and simplicity issues are left unchanged, the more expensive it will be for future generations to resolve. The Senate Select Committee Inquiry into Superannuation and Standards of Living in Retirement will be a valuable opportunity to debate these issues as banks are playing an increasingly important role in the management of superannuation funds.” In addition, the ABA also welcomes the business taxation initiative - the implementation of the Taxation of Financial Arrangements (TOFA). Mr Bell said: “These measures further cement Australia’s position as a global financial services centre in the Asian time zone. The ABA has been working cooperatively with the Government, Treasury and the Australian Taxation Office on TOFA which will more closely align the taxation treatment of financial instruments such as swaps, futures, and options with their accounting treatment.” For further information contact:-          Heather Wellard  ABA PR  Phone: 02 8298 0411      Mobile: 0409 830 439  ENDS