(Australian Associated Press)
KEY POINTS FROM PRODUCTIVITY COMMISSION’S REPORT INTO SUPERANNUATION POLICY:
* Gradually increasing the preservation age to 65 would deliver the budget $7 billion a year in 2055, mainly because of tax revenue from wealthier households.
* Households would be likely to delay their retirement by about two years and will have super balances about 10 per cent larger when they retire.
* There will be a modest two per cent increase in the workforce participation of older Australians in 2055, mainly among those with higher wealth or near retirement.
* Changing the preservation age will have little, if any, impact on many older Australians who retire involuntarily.
* An appropriate safety net would have to be a priority for those who become involuntarily retired.
* Less than 30 per cent of superannuation benefits are taken as lump sums.
* When lump sums are taken they’re most frequently used to pay down debt, invest in income stream products and buy durable goods that are used through retirement.
* Any changes to the system should cater for diverse circumstances, because “one size” does not fit all.
(Source: Productivity Commission research paper Superannuation Policy for Post-Retirement).