Low Growth Implications

In an article published in Cuffelinks today, Bruce Gregor raises a number of future issues facing Australian public finances and retiree funding if future economic growth slides due to maturing age structure in Australia like it has in Japan. You can access the article at http://cuffelinks.com.au/superannuation/demographic-insights-living-longer-with-low-growth .

One of the solutions put forward in the article for making inadequate retiree savings go further is compulsory partial annuitisation of superannuation. A detailed explanation of how this could work with 25% deferred annuitisation, was set out in research we added in February 2011 which you can access at http://www.findem.com.au/resources/displayResourcesArticle.php?id=127

A recent article on Cuffelinks from Paul Keating also supports compulsory deferred annuitisation of 25% of super although he advoctes all of this money being government administered whilst our proposal was for government overseeing the longevity reinsurance pooling process but with asset management continuing to be non-government managed. Paul Keating's article can be accessed at http://cuffelinks.com.au/fixed-interest/for-four-score-years-and-more-a-government-run-annuity-scheme

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