Superannuation...Politicians...Social Injustice...

Let me preface this blog with the following...I vote Liberal but think that what the current Liberal Federal Government tried to do in it's first budget was inequitable and disgraceful. In essence, they widened the social divide by trying to bludgeon those that can least afford it with all manner of changes to social security, welfare payments...in fact they appeared to be on a mission to screw every last cent out of the very poorest. But now I'm confused...let me explain. Last night, April 23, 2015 on the ABC Lateline programme, a very confident, self assured Labor Party Politician who goes by the name of Chris Bowen and is Opposition Treasury Spokesman announced the following: When and if Labor get to power, they will be socially responsible, (unlike the Liberals) and rule Australia fairly and in the interests of everyone. This fairness was already on display, (he inferred), because the Labor Party in opposition would announce future policies well in advance of the next election...one of these policies related to Superannuation. Mr Bowen stated: 1-For those still in the workforce and who earn more than $280,000.00 per annum, Super contributions would be taxed at 30% as opposed to the current rate of 15%. Now I know that $280 grand a year is a lot of money...but this Labor initiative smacks of Tall Poppy Syndrome. A person who has the skills, qualifications etc to earn that much must be doing something pretty right...and heaven forbid may even employ people just like I did before I retired. To me, that is an honorable thing to do plus it helps the economy and when I last looked, small businesses employed around 80% of the Australian workforce. It's probably more than 80% now, and on the rise, as large multi-nationals are deserting Australia like rats off a sinking ship...and they're not paying their fair share of taxes to our tax man. Shouldn't the equation be that if you earn those sorts of dollars, the tax man is already getting his fair share of taxes without hitting these people up for higher taxes on their Super...and wasn't compulsory Super introduced to force people to lock money away for their retirement. In effect, so that less people would be reliant on the public purse. It looks a lot like the Libs in reverse...and so the Social Divide will continue to get even wider! The second magical policy mooted by our Mr Bowen is: 2-For those in retirement mode who have accrued enough to be self funded, (that's my wife and I), if the Fund earns more than $70,000.00 per year, it will be taxed at 15%...that's in spite of us already having paid large amounts of tax and employing people who also paid tax. Once again, this smacks of the Tall Poppy Syndrome...and it stinks to high heaven. But one thing bothers me more than anything else...Mr Chris Bowen not once mentioned the situation with politicians' Super...or as it's known...Retirement Allowance. I don't know the exact figures, but Politicians must be a special breed in this society of ours...the "Super" is funded from the public purse, they can get at it after 12 years as a member of Parliament, it's indexed for life and the list goes on. Social Equity would to me suggest that their Super be handled and structured in exactly the same way as everybody elses...or am I just living in a place called Dream Land. Oh, and one last thing, the taxes raised from these brilliant new ideas were of the order of $12 billion over 10 years...that's 1.2 billion dollars a year...whoopee! Alan Kohler, a well respected finance commentator has stated that the biggest problem with the Super system in Australia is that $20 billion per year...(that's per year) is scraped off the top by those involved in running Super Funds and Financial Advisors. And on top of this, the Taxman doesn't have a real good handle on just how much tax is being raised even under the current regime. So there lies my problem...you work hard...you pay your taxes...you save for retirement and you think you've done the right thing. Then along comes a Politician!