Sep 25, 2026 · 10 min · 5 segments
In this brief chat with Leon Gettler, I explain why I think Australia's superannuation system is a political Maginot line, just waiting to be exploited. It is motivated more by empire-building – by…
Leon GettlerGuest
Nicholas GruenHost
So this raises a whole lot of questions about the structure of our super system, doesn't it?
Well, let me tell you my basic log of claims for the super system is that super system is compulsory savings.
We launched this compulsory savings system and ramped it up over the 80s and 90s.
for the left of centre party to establish a flat tax on a major part of Australia's economy.
So the first thing is the taxation system should not be concession, mostly concessional to the highest income earners.
My preferred way is to say that you either have compulsion or you have incentives.
Most people don't agree with that because they get their economics of a super system out of a textbook.
I'm a little more cautious about that for the reason that electoral politics is a fractious business.
And if you have people chopping and changing through the 40 or 50 years of your saving for retirement, that's not really great.
So my attitude is... you could ramp up the system a little more and you could have and it could be non-concessional you simply get taxed at your marginal rate in the super system but whatever but the alternative which is more popular is that there is a tax credit system and everyone gets 10 off their off their marginal rate of taxation in their super system that would be fair to low-income workers I did a quick chart yesterday, and the super system has a higher rate of average taxation for people on incomes below $63,000 and starts to become concessional above that figure.
And it's extremely concessional once you get up to, you know, well over $100,000 a year.
So this raises a whole lot of questions about the structure of our super system, doesn't it?
Well, let me tell you my basic log of claims for the super system is that super system is compulsory savings.
We launched this compulsory savings system and ramped it up over the 80s and 90s.
for the left of centre party to establish a flat tax on a major part of Australia's economy.
So the first thing is the taxation system should not be concession, mostly concessional to the highest income earners.
My preferred way is to say that you either have compulsion or you have incentives.
Most people don't agree with that because they get their economics of a super system out of a textbook.
I'm a little more cautious about that for the reason that electoral politics is a fractious business.
And if you have people chopping and changing through the 40 or 50 years of your saving for retirement, that's not really great.
So my attitude is... you could ramp up the system a little more and you could have and it could be non-concessional you simply get taxed at your marginal rate in the super system but whatever but the alternative which is more popular is that there is a tax credit system and everyone gets 10 off their off their marginal rate of taxation in their super system that would be fair to low-income workers I did a quick chart yesterday, and the super system has a higher rate of average taxation for people on incomes below $63,000 and starts to become concessional above that figure.
And it's extremely concessional once you get up to, you know, well over $100,000 a year.
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