Report calls for super to stay low
Compulsory superannuation should be frozen at 9.5 per cent, the Grattan Institute says.
Researchers say Australians should be encouraged to consider more flexible options to save for retirement.
The Grattan Institute’s new report says the Federal Government’s plan to lift the compulsory contribution to 12 per cent is misguided.
It warns that focusing on superannuation alone may not be enough for an adequate or comfortable retirement.
The study says superannuation is very different to retirement savings, and that super usually only accounts for 15 per cent of household wealth.
Grattan chief John Daley says superannuation has been “overblown”, and pushing it up to 12 per cent is not in line with the ways people save.
“If we do go to 12 per cent we will be forcing many households to in effect live less prosperous lives while they're working,” Mr Daley told the ABC.
“I think it's quite possible that we might see a government rethink the currently legislated increase to 12 per cent. It's already been delayed a number of times so it's possible we might see that rethought.”
The Grattan Institute research runs contrary to the Federal Opposition’s push for a 15 per cent compulsory contribution.
Even Labor elder Paul Keating says the change is critical to retirement planning.
But Mr Daley disagrees.
“It's needs to be around 15 per cent if you assume people don't saving outside and that’s just not true,” he said.
Mr Daley expects vested interests in the superannuation sector to immediately oppose the findings.