The Minister for Superannuation Bill Shorten has emphasised the critical role super plays in the health of the Australian economy in addition to its retirement savings purposes.
“We all need to be seized of this: superannuation is a tremendous low inflation instrument. And the savings pool created by super is a fuel for economic growth. Superannuation twice blesses our economy,” Shorten told delegates at the 2010 Association of Superannuation Funds of Australia conference in Adelaide yesterday.
To this end he urged employees to consider this effect when negotiating their next wage rise and considering what part of that rise will be made up of an increased superannuation contribution component.
“If you are negotiating your next pay rise, do you want to in effect hand over the extra money to the Reserve Bank (or indeed to a cynical CBA) in higher mortgage interest repayments? Do you want to give it to Coles or Woolies or Caltex in higher grocery or petrol prices? Or to Qantas or Virgin in inflating holiday prices?” Shorten asked.
“Or instead, do you want to stick it away in a superannuation nest egg – and benefit as you do from concessional tax treatment. In effect why not take a long bet that you’re going to live a long time? Because the reality is that’s really the choice,” he said.
“And while I have heartfelt empathy with the millions of families around Australia who are facing cost of living pressures – the last thing I want to see is their wages eaten up by inflation.”
According to Shorten superannuation savings will not only help the economy grow in the short-term but will also help alleviate the government’s pension and healthcare liabilities and expenditures from having to support an ageing population in the longer-term.
