Labor’s super reforms ignore personal freedoms

Chalmers is basically saying: “We’ve figured it out guys! We’ve got it. No need to debate this any further. The objective of super is to preserve savings and deliver income … kay? For a dignified retirement — got it? Alongside government support … in an equitable and … sustainable … way … see?”

The plan is to get this enshrined in law and have it become a “common yardstick” to beat the hell out of any future dissenters.

“The objective would be forward-looking and could be used as a common yardstick to consider prospective policy changes to the superannuation system,” the paper reads. “For example, how a proposed policy does or does not meet the legislated objective could be raised as part of consultation on policy or draft legislation.”

To think that the objective of superannuation can be defined once and for all in 2023 is foolish. It is also incredibly arrogant.

Superannuation means different things to different people. There are as many objectives of superannuation as there are working age Australians with super accounts. Superannuation is an individual thing, how we feel about it is personal and what we intend to use it for is also personal.

But Chalmers has been vocal about the role superannuation can play beyond retirement. He told an industry event in Sydney back in February that “we need productivity-enhancing investment — in climate and energy, housing, the digital revolution and more”.

Elsewhere, he has stated that he would like to “elevate and broaden” the social role of superannuation.

It’s comments like these that will irk those who don’t wish to see their super used for anything more than funding their own retirement.

Not all Australians care about the ethics of their investments. I recall a conversation years ago with an independent financial adviser. We were discussing the benefits of managed accounts. When I suggested that investors could use an SMA to create an ethical portfolio, he offered that a growing number of his clients are using them to contain collections of sin stocks, mostly mining, gambling, adult entertainment, and deadly weapons.

When I asked who would want to build a portfolio of unethical investments, he answered my question with a question: “What is unethical?”

He had a point.

Financial advisers know better than anyone how personal retirement savings are to Australians. Their entire value proposition is based on providing personal advice.

In a submission to the government’s consultation on the objective of super, published last week but submitted prior to the merger of the two bodies, the then Financial Planning Association (FPA) and the Association of Financial Advisers (AFA) stated that the proposed objective inadequately represents the ownership of Australians’ earnings in the super system.

“Government appears to be at the core of the proposed objective,” the submission said.

“However, Australians view superannuation as their money, their superannuation account, deducted from their income, which they were required to defer receiving from when they were working until their retirement.

“The objective must include a clear statement about the owner of the money held within the superannuation system and that must be the Australian consumer,” the submission said.