| 14.11,18. 05:12 AM |
Paul Keating says raising superannuation to 12 per cent will 'barely cut it'
Paul Keating on the state of superannuation in Australia today (7.30)
Former prime minister Paul Keating has rejected a Grattan Institute report that suggested scrapping plans to raise compulsory super payments from 9.5 per cent to 12 per cent, and raising the retirement age to 70.
Mr Keating, whose government introduced compulsory superannuation contributions, said Grattan Institute chief executive John Daley had a "miserable view" of the world.
Mr Keating told 7.30 that super payments had to be raised to 12 per cent, though that would "barely cut it".
"When I introduced super 32 years ago, people retired at about 65 and they died about 83 or 85," Mr Keating said.
"In the 30 years since, people are living three to five years longer, so people now live into their late 80s and the superannuation pool isn't large enough to maintain the sort of standard of living we wish for them."
The Grattan report also suggested including the family home in the Age Pension assets test where the home value is above around $500,000.
Mr Keating said Mr Daley "doesn't get it with his miserable view about having the two Australias".
"The privileged Australia where the wealthy people can have all sorts of assets but ordinary people are condemned to the pension. This is $460 a week. I mean don't whoop it up on 460 bucks a week. This is the John Daley view of the world," he said.
"Daley's recommending people work till 70, put their house in the assets test where now it isn't. In other words, you eat your house.
"Work till 70, eat your house, and then basically find yourself at a certain point in your life where you just don't have financial assets."
In response, Mr Daley told 7.30, "If Paul Keating actually read our report rather than repeating ASFA [Association of Superannuation Funds of Australia] talking points, he would know we don't advocate 'two Australias'".
"With 9.5 per cent compulsory contributions almost all workers will have quite a lot of retirement income from super," he said.
He said that on 9.5 per cent, "very few Australians will be on a full age pension until late in life".