The Government 2016 Budget changes to superannuation may have missed the mark in terms of reducing the cost of superannuation tax concessions to the public purse, according to new analysis from KPMG.
The KPMG analysis has pointed to the fact that the superannuation changes, including the $1.6 million cap and reductions to concessional caps, did not appear to have resulted in significant changes to Treasury’s calculations for the present and projected level of superannuation tax expenditures.
It said that, instead, the Treasury had calculated the cost of the superannuation tax concessions to rise by nearly 40 per cent in three years – from $36 billion to $50 billion by 2021 – higher growth than was projected when the 2016 Budget changes were introduced.
“Intriguingly, this growth in the cost to Government has actually happened after the imposition of those caps,” the KPMG analysis said. “This is driven mainly by the earnings concession, which is highly dependent on Treasury’s assumed rate of return within funds. It may therefore be inferred that Treasury has significantly revised upwards the rate of returns in the future.”
Michael Lovett, who left the investment firm just three months after launching its Vanguard Super offering, has taken up a chief executive role at an Australian asset manager.
The Central Bank of Ireland has granted the approval of Equity Trustees’ exit from its Irish operations, with the transaction expected to be complete on 30 April.
Super returns continued to climb in March, raising hopes of delivering double-digit returns by June depending on the performance of this next quarter.
The dedicated super fund for emergency services and Victorian government employees is under fire for unpaid entitlements to transport employees, which could exceed $40 million.
Add new comment