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24 Nov 2020

The Treasury: Retirement Income

The Treasury published the Retirement Income Review – Final Report on the 20 November 2020.

You can see the interaction of our retirement income system in the above diagram, the full report is 648 pages long but we have attached the Key Observation and Overview document which is only 44 pages.

Click to read.

Why is the Retirement Income Review – Final Report an important document?

Because the Federal Government will use this report to help it argue that the compulsory 9.5% superannuation guarantee (SG) should not be increased to the legislated 12%.

The Federal Governments position is that higher SG contributions come at the cost of lower wage growth and increasing the SG rate benefits high income earners the most.

Both of these two points are supported by the findings in the Retirement Income Review – Final Report.

In terms of absolute retirement dollars, we agree that the SG does benefit high income earns the most. It is a fact.

However in reference to lowering wage growth, must disagree based on the past evidence.

The SG began in 1992 at the rate of 3.0%, has been increased to the current 9.5% and wages during the intervening 28 years have most definitely increased and significantly for many industries.

Disciplined saving is always good. For everyone.


At Newealth we are always looking to support and promote our clients wherever possible and if you have any ideas or comments, please feel free to email me or to call me on +61 2 9267 2322.

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