Superannuation was a key, if not overwhelming, focus of last week’s federal budget. High-income earners were a particular target for the government, and various changes, including a lifetime cap on non-concessional contributions and limits on transfers to pension accounts, will be retrospective.
The government also announced the objective of superannuation, which it plans to enshrine in legislation, will be: “To provide income in retirement to substitute or supplement the age pension.”
In its post-budget report, EY was critical of the changes, despite their alignment to the government’s defined objective.
“Despite being aligned to the defined superannuation system purpose, these changes will be a further administrative burden that may challenge short-term efficiency objectives of the system, funds and service providers and associated government agencies,” EY stated.
EY had long predicted that superannuation was going to be a significant target of the federal budget this year.
EY Australia’s superannuation leader Maree Pallisco told AccountantsDaily's sister publication SMSF Adviser earlier in the year that it seemed inevitable that superannuation tax concessions would be in the government’s firing line.
“From what we understand, the government is looking for anywhere between $2 billion and $6 billion from the superannuation industry, and there is no other way to do it, unfortunately,” she said at the time.