News reports that the scope of the Morrison governments review into the retirement system could be scaled back so as not to “open up a can of worms” as one analyst put it is really defeating the purpose of the exercise.
No doubt the government is carefully crafting the review’s terms of reference after the whacking the opposition received in the last election over proposed changes to negative gearing and franking credits.
Serious changes need to be made in an economy with the number of taxpayers becoming fewer relative to those in retirement at a faster pace than ever before.
The entire retirement system needs to be reviewed including the way funds are taken out of retirement accounts to be spent on something else, the level of cash franking refunds to the wealthy, the role of the untaxed home in pension provisions and dare I say it the unprecedented transfer of trillions of dollars of once in a generation wealth that at present goes untaxed to the fortunate few of the next generation as the baby boomers fall off the perch.
Retirement funds that have been subsidised by the government need to go towards retirement. It is best to get all this done sooner rather than later and actually implement the recommendations and not have them shoved aside like so many others.
The compounding effect of any changes made early on will lessen the impact of any drastic action having to be taken further down the track.
A few snippets from the past week include:
* Information out of the tax office said the average tax refund this year has only increased by $265 to $2,699 despite the government’s income tax changes. In the first nine weeks of the new financial year the Australian Tax Office issued around 5.4 million refunds for individuals worth $14.5 billion. Dodgy claims are also lower.
* The Melbourne Storm has launched their own brand of home and personal loans. My Local Broker will be the funder of the loans and will share commissions with the club. Storm chief Dave Donaghy said delivering meaningful savings to members is fundamentally important.
* The share price of Kyckr jumped 90 per cent in one day last week after news that Wise Tech chief Andrew White acquired a 19 per cent stake in the company.
* Beware the fraudsters. One group calling themselves Team Awesome has allegedly swindled $2 million from superannuation accounts and on-line share trading accounts after buying identification information on the dark web.
* Exxon is planning to sell their share of the declining Bass Strait oil and gas fields for a price around $3.5 billion. Hefty remediation costs could be a potential hurdle for buyers say analysts and the field is producing less than one tenth of what it once did. The field has produced more than four billion barrels of oil.
* Queensland public servants could get a one off $1,250.00 bonus for new public service industrial agreements at a cost estimated to be around $250 million.
* Victorian Premier Daniel Andrews will become the second highest paid politician after receiving a $46,000 rise from the remuneration tribunal.
* According to Morningstar the amount of capital in funds that track broad US equity indexes hit $US4.27 trillion in August surpassing that of funds invested in active managers.
Trade wise there were no changes to the educational portfolio. More commentary and charts on the Courier website Wednesday, cheers Charlie.
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