The Australian government is considering a radical overhaul of the superannuation system.

A new proposal from the government suggested that retirees' super funds could be used to cover their aged care expenses.

This move is aimed at easing the financial burden on the Commonwealth's budget and ensuring the sustainability of the aged care sector without introducing new taxes.

The proposal is based on a government-commissioned report by the Aged Care Task Force, which indicated that due to the superannuation system, future retirees are likely to be wealthier than previous generations.

'Over the next 20 years, the number of people with superannuation balances at age 85 will grow considerably, with a greater proportion of people having significant funds available,' the report read.

The government has proposed a radical overhaul of the superannuation system. Image source: Shutterstock.

The report suggested that these funds could be better utilised to support individuals' health and aged care costs in retirement.

This shift in policy could have significant implications for Australians planning for retirement.

The task force's findings show that the proportion of people over 65 relying on the aged pension or other income support is projected to decrease by 15 percentage points by the early 2060s, thanks to the growth in superannuation and assets.

Prime Minister Anthony Albanese has emphasised that the proposal is not intended to penalise hard-working Australians but to create a more sustainable system for the future.

'We'll consider the recommendations, we know that it is a difficult time for people when you have a loved one who requires care who's unable to continue to live at home,' he said.

The report also highlighted the need for the Commonwealth to maintain a significant role in funding aged care services.

It also recommended a robust safety net for those with limited means to meet their costs.

Catholic Health Australia has urged the government to act quickly on the report's recommendations, pointing out the financial strain on most aged care providers and the necessity for responsible reforms to ensure continued investment and quality care.

'With most aged care providers running at a loss, these sensible and responsible reforms are urgently needed so they can continue to invest and provide quality care for all Australians,' CEO Jason Kara said.

'The fairest way to deliver extra funding is to ask people who can afford it to contribute more for their accommodation and living expenses, costs they have covered over their adult lives.'

The Council on the Ageing Australia has also called for ambitious action to address the challenges posed by an ageing population and the growing complexity of aged care needs.

'The conversation about the long-term financial sustainability of aged care is a crucial one, and one which we can't afford to shy away from,' CEO Patricia Sparrow said.

The task force, led by minister Anika Wells, put forward 23 recommendations, all of which are currently under government review.

Key Takeaways

• The government has recently proposed the use of Australians’ superannuation to fund aged care costs to ease the financial pressure on the Commonwealth.
• The government has ruled out introducing a new levy or tax to fund the aged care sector.
• The Aged Care Task Force report indicated that the proportion of people over 65 relying on the aged pension is expected to decline, in part due to better superannuation and asset ownership.
• Prime Minister Anthony Albanese asserted that using superannuation for aged care will make the system sustainable, as the report called for the government to continue playing a significant role in funding aged care services.

Members, what are your thoughts on using superannuation to fund aged care? How do you believe these changes could affect Aussies’ retirement plans? Share your thoughts with us in the comments below.

 

[hazbout]

The first thought that came to my mind when reading this article was will there be then different levels of care within the system for ones who pay and those that dont
Will this introduce discrimination in the aged care nursing home?
My mother is in the Catholic aged care and even now you see subtle discrimation
Arcare also have different levels of care which I have observed when trying to see if I can move my mother closer to where I live
Already you see it in the industry if you are Government funded partially or wholly you have a bigger wait time to get permanent accommodation.
I personally witnessed one resident who was in respite in the Catholic homes sent away when management changed in that facility and the family had to find another facility eventhough they were promised that he will become a permanent resident

Why can’t the government look at Group Age Care housing for those who have huge super balances

In my opinion the really wealthy don’t use aged care as they have the means to look after their elderly by have one on one nurses and support as they have the money

 

[Suzanne rose]

If it means you are going to get better care then I'm all for it.
I wouldn't want to pay for the kind of care my uncle or grandfather received.

Hopefully if I get to where I need a nursing home then I pass away first. After seeing my grandfathers treatment I would rather just be gone

 

[maurice wildish]

Hi well another trick to allow Govt to waste more money, they should review some european countries Sweeden Norway , and others, its ok if your super is $30.00 to $1.00, have all the other benifits of the well paid public servants, but for people who have worked in own business or small wages this sounds like bad news A typical way of Govt reducing responsibilities for giving back to thepeople who have helped build this great country. Winston Churchhill said, if the Govt offers you $2.00 they have already taken $4.00, so true. Thankyou for some interesting articles

 

[Soldier1964]

Why scrimp and save your whole life only to now have to pay for something that was previously supplied by the government. The government is full of corruption. Once you get rid of the corruption and pocket lining in government you will find their is enough money to support all Australians in Nursing homes. I am not going to use my super fund to pay for my nursing home just so the government can spend the money elsewhere or waste it on their own political agendas.

 

[Gsr]

My thoughts are, if the government has money to dish out to young people who have good jobs, and the majority are much better off financially than we were when we were young, to help fund their decision to have a baby then they should have money To fund aged care for older people who have worked a lot harder than a lot of young people will ever have to, who have scrimped and saved all their lives to finally be able to retire and live below the poverty line for pensioners. It is beyond me why the government is funding maternity/paternity leave when most employers fund it. To my knowledge there is no limit to how much anyone earns, have a baby and the government will fund it even if you are a millionaire. Also might stop the number of unwanted kids if the government stopped dishing out so much money for having a baby, I know people who are single and have had a baby just to get the government money to buy a new tv, washing machine or whatever, drugs, smokes and alcohol included. Baby gets dragged up and left to his/her own devices as soon as they are able to fend for themselves. Older people get nothing really for all their years of struggling to live a reasonable life, they just get thrown to the trash by successive governments. I do believe people who are wealthy enough to fund their own aged care should do so, when I worked in aged care we did have wealthy people paying huge weekly fees to cover their own care, they were not subsidised by the government, I wonder if this has changed or is still the same. When my uncle was in aged care he had to contribute an extra $100 a week, despite being a pensioner, because he was deemed to be able to afford it. That was only four years ago.

 

[Kiwisinclair]

No way we worked hard all our lives payed our taxes got ahead in our lives struggles now you want to do this to us when does this shitstop.we are the most taxed people on earth the reason we have super cause the goverment is making it to hard for people to get a pension that have worked hard and have assets .this country is great to live in but not for retires every time we open the letter box there's a f....n bill it never stop

 

[RB7]

You speak the words that 99% of us think. When will governments listen?
Too busy to notice the elders while they make decisions that really benefit them or their mates who promise them to support their agendas….

 

[Bill MacL]

Well, if it isn't going to be until 2060's I won't be around anymore and hopefully that lying c--t Alboneasy won't be either.

 

[Kentsue]

For starters women don’t retire with to much super savings because of being paid less than men and having time off work to have and care for their children then when they do get back into the workforce they work less hours have to care for children or school pickups and other factors
Super is being dipped into by people before retirement to put deposits on houses over covid they could withdraw money and for teeth work as reported in the news
While super is able to be accessed before retirement this plan will never work people just want have the money
As for the ageing now woman don’t have enough super because they have always been on low wages their whole working life and all the super is spent before going into nursing homes on the high cost of living these days and keeping in mind they only had super on a part time or casual jobs
Here’s a thought how about giving self funded retirement that did the right thing and went with out there whole working life just to pay of a house and bring up their children with out any help from government a full pension instead of waiting until all there savings have been spent that they have saved to have a comfortable retirement who have paid all their taxes which goes to keeping retirees who have been given money all their lives and get to get a pension and that’s what I think

 

[Cerise Warren]

I don't know how this will work

 

[Staffordshire Whippet]

I don't know how this will work

Neither do they!

 

[Shane O'Neill]

Amazing the Catholics Health Australia are asking for the recommendations to be taken up well well isn't Rome flush with cash that could help Catholics in their aged-care that have put in the plate all their lives but no they hoard it away instead private sector chasing profit over care the then liberal government pumped millions in to private health care not the public sector and how many died because of COVID-19 in the private sector profits before care there

 

[Cheezil]

Why scrimp and save your whole life only to now have to pay for something that was previously supplied by the government. The government is full of corruption. Once you get rid of the corruption and pocket lining in government you will find their is enough money to support all Australians in Nursing homes. I am not going to use my super fund to pay for my nursing home just so the government can spend the money elsewhere or waste it on their own political agendas.

Immigration possibly using a lot of our country's resources thanks to dodgey govts & they expect us to now fund these things that our taxes were meant to fund or used to fund. Its a joke!

 

[Cheezil]

Controlled in so many aspects of our lives these days. No more freedoms! I feel sorry for younger generations! A bit like the banks & govt trying to force a cashless society- we should have a CHOICE!!

And what happens if you need a care home sooner than the age they'll allow us to access our super for it? Or other dire circumstances arise?
Young people cant even afford housing these days in the here & NOW, but expected to fund their own distant future Aged Care, seriosly?

 

[darrellkakoschke]

I do not understand why the government forces you to have super in one hand then look at other ways of taking it away from you. Unfortunately it is like a pig with its nose in the trough all the time. If a person is not fully self sufficient then they should not be penalised by the government or the aged care home. People are presently being encouraged to remain in their own home, but yet again they are being ripped off by unscrupulous people/organisations. Where is the safety net for retirees to be able to plan and manage their retirement until death?.

 

[deando_au]

A typical government response to expenditure. While at the same time our illustrious, overpaid politicians stuff even more of our taxes into their own pockets. Perhaps a better solution would be for said politicians to opt for lower payouts during their term service and a significant reduction in their government pensions upon retirement from politics.

In my opinion, politicians should be given the same privileges as all other retirees. Either the 10.5% - 11% of their salary withheld in superannuation accounts and/or the same amount of aged pension they pay to all other retirees.

 

[gollywog]

Well, if it isn't going to be until 2060's I won't be around anymore and hopefully that lying c--t Alboneasy won't be either.

Well said Bill Mcl but I have to say, Alboneasy isn't a c--t, because they are useful

 

[JedCorella]

For starters women don’t retire with to much super savings because of being paid less than men and having time off work to have and care for their children then when they do get back into the workforce they work less hours have to care for children or school pickups and other factors
Super is being dipped into by people before retirement to put deposits on houses over covid they could withdraw money and for teeth work as reported in the news
While super is able to be accessed before retirement this plan will never work people just want have the money
As for the ageing now woman don’t have enough super because they have always been on low wages their whole working life and all the super is spent before going into nursing homes on the high cost of living these days and keeping in mind they only had super on a part time or casual jobs
Here’s a thought how about giving self funded retirement that did the right thing and went with out there whole working life just to pay of a house and bring up their children with out any help from government a full pension instead of waiting until all there savings have been spent that they have saved to have a comfortable retirement who have paid all their taxes which goes to keeping retirees who have been given money all their lives and get to get a pension and that’s what I think

This wage disparity between men and women is a load of BS! Feminism has created so much friction between men and women and that is done on purpose.
Women, as a general rule, don't spend as many hours at work as men. It is a fact. I am sick and tired of women crying about inequality. Where are the women working in construction or as sewage workers? How many are climbing up electricity poles after a natural disasters? They just want the cushy office jobs just in case they might break a fingernail at a job that requires to get your hands dirty.
Don't cry inequality until you get off your collective arse and do the same jobs that men do. If you do as good a job as men you do deserve the same pay but not if you aren't capable but don't be part of a quota that employs because of your sex instead of your ability.
Men and women are build differently and just don't have the strength that men do. That is why they had to change the criteria for entering the armed forces, the police and firemen.

 

[Seioner me]

The goverment can stay the hell away from my superannuation i earnt it and I will use it as I see fit .....damn socicilist!