Meeting our demographic challenge:
(2) boosting retirement incomes

This Budget will further position Australians to prepare for their retirement through enhanced co-contributions and reduced superannuation surcharge.

Incentives like the Government’s co-contribution of $1.50 for each $1.00 of private contributions to superannuation are an important part of encouraging higher savings.

Saving for retirement

The Government’s retirement income policy encourages Australians to achieve a higher standard of living in retirement than would be possible from the age pension alone, while ensuring all Australians have security in retirement.

The Government’s statement, A more flexible and adaptable retirement income system, outlined measures to further broaden the availability of superannuation, provide more choice in financing retirement income, and make superannuation more adaptable to changing work arrangements.

Measures include:

• Allowing market linked complying pensions
• Removing the work test for those below age 65
• Simplifying the work test for those aged 65 to 74
• Preserving rolled over employer eligible termination payments
• Allowing people to access superannuation before retirement to enable them to keep working in their transition to retirement.

Details of changes to the retirement income system are outlined in the statement, A more flexible and adaptable retirement income system, released in February 2004.

Saving for retirement will help address the challenges of our ageing population.