Mr Costello was giving a keynote speech at the Association of Superannuation Funds of Australia conference in Melbourne yesterday.
“The commission of audit reported recently that in 2050, even assuming a 12 per cent contribution rate, 80 per cent of Australians will still be on a full or part-pension,” Mr Costello said.
Mr Costello pointed out that concessional taxation of superannuation fund tax earnings would provide greater benefits for super fund members – as well as the government.
“The treasury estimates [these] concessions to [be] around $16 billion to the industry,” Mr Costello said.
“What superannuation will do is it will deliver additional benefits, but those additional benefits to the pension will be used by the government to claw back and turn full-pensioners into part-pensioners,” he said.
“These concessions can be justified on the grounds that they are assisting people to save for retirement, and justified when you bear in mind that the government will get a substantial amount back when later in life [it] claws back aged pension.
“Any assessment of the true cost of these concessions must take into account the savings on the aged pension that will be delivered back to the government as a result of private superannuation,” he said.
