It seems few are more surprised than Scott Morrison that the Liberal / National Coalition will be forming Government after the 18 May election. However, the ALP’s policies which have worried many superannuation savers would appear off the table for now.
The campaign was largely characterised by negativity on both sides.
The Coalition focussed on the risks of a change in Government, Bill Shorten’s personal popularity (or lack thereof) and the negative impacts of Labor’s new tax measures without presenting a compelling story about how we tackle some of the major issues of our time (climate change, housing affordability in our major cities and the related issue of underinvestment in our regions, our aging population etc).
The ALP made it clear that they had big plans for the Government to do more (around issues such as dental care, childcare, medicare, climate change, housing affordability) but rather than doing so with visionary plans to increase the size of the economy, they would focus on redistribution – largely extracting more money from savers (with changes to franking credits, negative gearing and trusts). While the ALP would have liked to call these “closing loopholes for the big end of town” it would seem the electorate judged them to be “demonising people who have worked and saved hard”.\
When it comes to superannuation, the broad take away from a Coalition win is that we should see less tinkering and probably the execution of their remaining superannuation agenda which is largely positive for SMSFs (increasing possible member numbers from 4 to 6, modest extensions to the timeframe for making contributions from 65 to 66 etc).
While not directly impacted by the outcome of the election, it will be interesting to see what the result does for industry funds.
In our view, industry funds play a vital role in providing a streamlined, scaled, low cost superannuation option that is completely appropriate for the vast majority of superannuation savers at some point in their lives.
The sector’s influence on Australia’s superannuation landscape is huge and largely positive. But recent moves towards using their influence to prosecute agendas that are not necessarily in line with maximising their members’ retirement savings has been worrying. Shareholder activism is fine when you’re playing with your own money. Not when you’re doing it with someone else’s. It is likely to be less feasible with the continuation of a Coalition Government.
The 2019 election campaign has been an interesting ride and as usual has served to highlight something that should worry us all as superannuation savers, taxpayers and citizens. Our retirement savings system (headlined by superannuation) is still treated as a political plaything. That means any respite we feel today will probably last for three years at best.