AUSTRALIAN BANKERS’ ASSOCIATION WELCOMES REPORT FROM INQUIRY INTO SUPERANNUATION AND STANDARDS OF LIVING IN RETIREMENT   Sydney, 12 December, 2002: The Australian Bankers’ Association welcomes the report on the Inquiry into Superannuation and Standards of Living in Retirement from the Senate Select Committee on Superannuation. David Bell, Chief Executive of the Australian Bankers’ Association (ABA), said: “The ABA is pleased to see that the Senate Select Committee recognised that the current arrangements for superannuation may not provide adequate income in retirement for most people.”   “Australians are not saving enough for retirement resulting in a gap between the expectation and aspirations for their standard of living in retirement and what the present system will actually deliver.”   “While the Committee has stopped short of recommending that the 9% Superannuation Guarantee should be increased for employees, the ABA is pleased to note the recommendation on extending eligibility for Government co-contributions – the threshold has been raised to include people on average earnings. This recommendation should help the broad middle income group where the bulk of the adequacy problems lie.”   The ABA also supported reducing the taxation impact on superannuation, focussing on lowering up-front taxation on contributions, including removing the superannuation surcharge and addressing its objectives at the benefit stage. This would improve incentives to contribute more to superannuation savings and increase retirement income.   “I am pleased to see that this has been recommended by the Committee, and that in the long term, superannuation contributions tax may be gradually removed and replaced with a new approach to taxing end benefits, ” Mr Bell said.   “While the ABA recognises the need for a substantial lead time before tax changes are made, I don’t believe this change needs to be phased in over many years.”   “I do, however, welcome the recommendation that offers improved incentives for national savings, in which the Government would examine the introduction of a tax-preferred medium to long-term savings vehicle which could be accessed prior to retirement for health care costs, a home deposit and education.” Mr Bell said on simplicity, the ABA is pleased to see the recommendation to remove the benefit and contribution limits which is recommended when taxation is moved to the benefit end stage. The ABA hopes the Federal Government will seriously consider this comprehensive report and its recommendations that could help Australia’s ageing population save more for their retirement.   Editors please note:   A copy of the ABA’s submission to this Inquiry can be found on the ABA website: www.bankers.asn.au   For further information contact:   Heather Wellard ABA PR Phone: 02 8298 0411 Mobile: 0409 830 439     ENDS