At this week’s Pension PlayPen coffee morning, Guy Opperman told we could look forward to what was happening in Australia today, being UK pension policy tomorrow, so here – courtesy of the Australian Financial Review is a Government incentive to turn assets tied up in bricks and mortar into income capable of paying the increasing costs of groceries.
Older Australians will be encouraged to downsize their home under a government plan to lower the age threshold for superannuation contributions from property sales to 55.
Prime Minister Scott Morrison will unveil the plan at the Liberal Party’s official launch in Brisbane on Sunday. The government says it will let up to 1.3 million more Australians use the sale of their family home to contribute to their super.
Opposition Leader Anthony Albanese described the proposal as “modest” and “sensible” and said a Labor government would support it.
The changes, designed to free up housing supply, also include doubling the time pensioners have to restructure their assets following the sale of their family home, with proceeds to be exempt from the asset test for two years. Here’s how Scott Morrison is selling the reform.
“By removing barriers for Australians downsizing to residences that better suit their needs and lifestyle, we are helping to free up larger homes for younger families,”
“Buying your first home is never easy and that’s why we have been focused on helping more than 300,000 people realise the great Australian dream of owning a home.”
Under the current rules, people aged 65 and older can put up to $300,000 per person into their workplace pension from the sale of a home. The age threshold will drop to 55 from July 1 and the Morrison government expects this to make 1.3 million more people eligible.
The changes for pensioners, around 1.9 million of whom own a home, will begin from January 2023 and are expected to cost $62 million over the forward estimates.