The compulsory superannuation system is one of the thorniest issues in Aussie finance, with different industry and political players calling for very different policy outcomes.
Now, think-tank The Grattan Institute has issued a paper rejecting calls for the superannuation guarantee (the amount employers are forced to pay workers) to be increased by 2.5 per cent, arguing that Australians are retiring with enough in their nest eggs under the current system.
Weighing in on the report, Your Money anchor and The Australian economics editor Adam Creighton spoke with Industry Super Australia deputy CEO Matt Linden live on Trading Day on Wednesday.
Creighton, who has been outspoken on superannuation policy, asked Linden whether super funds have a “vested interest” in supporting calls for increased guarantees.
“Well our funds are not-for-profit funds and what we are interested in is the circumstances of our members,” Linden said, going on to reject the notion that super funds are trying to expand their influence or power by supporting mandatory minimums.
“Do you think there is any case at all for giving workers the choice?” Creighton asked. “Surely they’re best placed, rather than the government, to know whether they want to spend their money now or later.”
Linden admitted that the system of mandated super guarantees is “to some extent paternalistic” but said that without the current system and additional guarantees Australians would be ever more reliant on the government pension.
While he said he would not “dismiss the [Grattan Institute report] out of hand”, Linden said its approach is very “black and white” and had some underlying issues with modelling.
Watch the video above for the full exchange between Creighton and Linden.