16 Apr 2014

The Financial Services Council (FSC) chief executive John Brogden has asked for superannuation access age to be lifted, to close the “seven year gap” with the pension age.

“There is a 7 year gap between the age you can access your superannuation and your pension,” Brogden said on ABC TV’s ‘The Drum.’

Brogden noted that most Australians can access their superannuation at 60, but that they don’t start receiving their pension age until 67.

“The signal there is that you should spend your superannuation so you can get the majority of your pension when you reach 67,” Brogden explained.

He spoke following Treasurer Joe Hockey’s citation of the International Monetary Fund’s (IMF) recommendation that more countries should consider raising their pension ages during a speech in ‘The Global Age of Responsibility, Reinventing Bretton Woods Conference,’ in Washington this week.

Hockey’s words reinvigorated the debate about the potential for lifting the pension age to 70.

Commenting on this, Brogden said that it would be the government actuaries’ task to figure out the right age.

However, he called for a tightening of the means testing for the eligibility on the age pension.

Brogden said that at the moment “you can have a family home untaxed and unmeasurable for your pension eligibility, you can have a million dollars in assets and you can get $60,000 per annum of income as a couple and still get the age pension.”

“Surely the age pension was never designed for people with those assets.”

He also said that if the pension age climbs to 70 years old, there should be a “clear and transparent early access regime for people who physically can’t work.”

Written by Laura Millan in the financialstandard.com.

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