David Murray, who headed up the Financial System Inquiry, has pleaded with stakeholders across the superannuation sector not to “complicate” the proposed objective, lest more politics enter the system.
Speaking at the Committee for Sustainable Retirement Incomes’ Leadership Forum in Canberra, Murray said when the inquiry was framing the objective, it wanted to get some of the benefits of a defined benefits system without repeating the mistakes, such as over-promising or taking advantage of people by appearing to over-promise.
“My plea today is not to complicate the objective in legislation; to support a single, clear, unqualified objective, and to support the objective recommend by the Financial System Inquiry,” Murray said.
Murray was challenged by a delegate that his argument did not make sense, as adequacy could be included in the object and not defined.
Murray responded that the timeframe over which an individual would receive an income meant they would outlive many parliaments and, as such, it was better not to allow the parliament to get into a political debate on adequacy, which itself would cause continual changes to the system.
“A debate about adequacy becomes a debate about social equity. And the parliament already has control of the size and conditions of the age pension,” Murray said.
“My positon is that allow the industrial bargaining to be had over the size of the contribution, allow the Parliament to determine the age pension, but don’t confuse the objective with adequacy, remain on an objective to produce a retirement income.”