Australia's Retirement Income System: Implications for Saving and Capital Markets / Malcolm Edey, John Simon.

Format:

Book

Author/Creator:

Edey, Malcolm.

Contributor:

National Bureau of Economic Research.

Simon, John.

Series:

Working Paper Series (National Bureau of Economic Research) no. w5799.

NBER working paper series no. w5799

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Australia's Retirement Income System

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1996.

Summary:

Australia is in the early stages of introducing a system of self-provision for retirement through mandatory contributions to" private superannuation funds. For most employees, the scheme will eventually replace, either fully or partially, the government age pension, currently relied upon by a large majority of retirees. The scheme has been implemented reasonably smoothly by building on existing financial infrastructure for voluntary superannuation. This paper summarizes the historical background of mandatory superannuation in Australia, reviews its potential impact on saving and capital markets, and highlights some remaining policy issues. Perhaps the most important of these is the impact of the system on retirement decisions. A number of features of the system contribute to incentives favouring early retirement and continued reliance on the government pension. Also important is the increasing complexity of the system, a result of the layering of rule changes and grandfathering of existing rights at each stage of the process.

Notes:

Print version record

October 1996.