Keating slams PM for early super scheme
Paul Keating has slammed the Morrison Government scheme that allows Aussies to dip into their super, saying "baby-faced Liberals" were seeking to unravel the $3 trillion retirement savings pool.
Speaking to at an Industry Super Australia forum, the former Labor prime minister said the lack of scrutiny over whether people were eligible to withdraw payments would leave younger low-income workers with little to no retirement savings.
Mr Keating said government payments should have taken priority over opening the flood gates to the savings pool, which has already been drained of about $32 billion from coronavirus hardship claims.
The scheme allows Australians to withdraw $10,000 from their super in both the 2020 and 2021 financial years. It is available to people who have become unemployed or experienced a reduction in working hours due to the coronavirus pandemic.
"There has been no scrutiny on the reasons for the withdrawals," Mr Keating said.
"The national response should have been a fiscal policy response - not the burden of the income support and maintenance of living standards coming from people's long-term retirement savings."
Mr Keating told the forum, the majority of funds accessed from the scheme had been from the lowest paid people in the country, and would force future retirees to rely more heavily on the aged pension.
The former Hawke Government treasurer said 600,000 people under the age of 35 had completely drained their retirement savings accounts.
When asked about the scheme last week, Prime Minister Scott Morrison said the government didn't own the money and Australians should be able to control it.
"It's their money. The intent for which it is used is decided by the person whose money it is," he told reporters.
"The government doesn't give people lectures about how they should spend their money.
"There are legitimate and appropriate rules to enable people in this time of hardship to access their own money to do with it what they believe is best for them."
Industry Super Australia chairman Greg Combet said early super access should be tapered by Christmas, adding the sector would be crucial in recouping financial losses incurred during the pandemic shutdown.
ISA and Mr Keating also said raising the superannuation guarantee from 9.5 per cent to 12 per cent was a crucial step in ensuring Australians had adequate savings at retirement.
Mr Keating said a noisy Liberal backbench attempting to undo the rise would be detrimental to Australia's wealth pool, especially at a point when investments would "spur" economic recovery.
"It's just fanciful nonsense," Mr Keating said.
"There is no economic case for it not to go ahead."
Liberal Senator Andrew Bragg said superannuation costs the federal budget more than it saves and has become a wealth pool run by banks and unions.
"Most Australians are still on the pension and the fees charged each year exceed $32 billion," Mr Bragg said.
"The unions and banks were given the scheme to run and they have run it for themselves, not for the workers. It's a scheme that will only survive if we make it work much harder for workers, not vested interests."
Superannuation guarantee contributions made by employers have been legislated to incrementally rise to 12 per cent by the middle of 2025.
Originally published as Keating slams PM for early super scheme