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.

 

[Phantom55]

Every politician has had their eye on our TAX PAID contributions since they were told HANDS OFF (this is their pot of gold at the end of the rainbow,)Once they can get their grubby little hands on it(EVEN FOR THE NOBLEST CAUSES..initially,).that will be thier entry, after that it will become general revenue for them

 

[Phantom55]

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.

Can any tell me why a politician can access their super any time and not have to wait til a certain age, and also how do they contribute to their super? or is that another perk as well...and they have the gaul to seek donations to get elected or re elected, sounds like a good windfall job, work 4 or5 yrs and retire with wages for life accessible immediately...anyone want to donate money to me so I can get rich also im willing to kiss babies and tell lies etc and I would very much like to retire in luxury with access to my non contributional super......

 

[Phantom55]

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….

the govt will never listen!Why should they when we as a country vote habitually roughly 40%lib and 40%lab, these voters approx knock each other out , the REAL deciding votes are the minority parties(think about it) and these are responsible for the weird objectives of ea party, yes they are the real electors, some are pscho,some are clever etc but ALL of them decide which crowd we end up being governed by,Loyalty to a football team (win or lose) is honest loyalty. .. to a governing body is stupid and gives us the govt we deserve and not the govt we want,Vote on performance, make them do their job (we pay them enough) make them earn it

 

[Sassy P]

I have been a carer for a few years just resigned, I cared for a couple that had to go into care, they had to sell their home and pay $800,000 for a twin room that is not very big, and condition's and the food is shocking, to the point where i do some shopping for them each week to make up the difference which should not be needed. Apparently they use the money to invest and just take 4% yeah right. This id run by a church group. I just want to go bush live out my life.

 

[Da Freddo]

Okay I've read all the hype from Yay and Nay parties.
What would happen if we all withdrew are entire amount of super and hid it under the bed { so as to speak}
who would then foot the bill ???
I have no doubt are kids would be held responsible.
for Christ's sake lets bring back Paul Keating, with John Howard as his 2nd in command.
Then we would have "NO PROBLEMS" for these 2 blokes were switched on ..
I don't care what anybody says,
LOOK AT THE SHIT WE ARE IN NOW..
WE NEED SAVIOURS, and the current crop of WANKERS in parliament just don't understand or THINK.
It is time we the aged population stood up and yelled ENOUGH IS ENOUGH.
MY MATE WAS A COP IN THE POLICE FORCE, he was behind the lines.
His super is not deemed as an asset.
I sweated in the most in the worst conditions in Australia for years.
Building the mining of wealth of Aust, in WA NT QLD SA, For years which took it's toll on my body
Then in Adelaide I was L/H and Supervisor responsible for the 3000 class Railcars.
The Mount Gambier West Switch Yards {ETSA}.
The power generation for Mawson, Davis, and Casey Base in Antarctica.
The Robbins Miner borer for Pasminco Metals.
The 300/600 platforms for the Collins Class Submarines and Torpedo tubes.
Power generation for Yalata ,Nepabunna, Ernabella missions which entailed working for endless weeks away from home in the most shocking of conditions, "I KID YOU NOT"!.
And for all that of which I have helped build AUSTRALIA I GET KICKED IN THE ARSE BECAUSE I WAS NOT A "COP". { MY SUPER IS DEEMED AS AN ASSET.}
I paid off 90% of my debits when I retired and it took 6 months and countless visits to Centre link to eventually finalise my account with them ..
With what Centre Link pay me, I would have been better off telling Centre Link to go F%$k yourself.
The GOVERNMENT EMPLOYEES WIN EVERYTIME ESPECIALLY THE WANKERS IN THE PARLIAMENT.
Your Honour I rest my case.

 

[Chris]

Just bend over, spread your cheeks & ask them "How wide?". Greedy crooks the lot of them!

 

[Gloria Mac]

Don't know if you realise but if you receive a pension from another country like UK and declare it (as I did) they then take away some of the pension which you paid taxes to collect in Australia. The UK pension does not increase ever unless you live in a country which is not a Commonwealth country. Thus you are getting penalised for having worked hard all your life. I know of people who get a UK pension and have not declared it so are getting the full Australian pension in addition to their UK pension.

I do know this. I also know ex pats living in the UK who never update they’ve moved from rental to ownership of their home & have been getting both Uk pension & Australian pension complete with rent assistance. When I questioned them they said they’ve never updated their original Australian pension request years ago. What is wrong with our government?