By Olivia Long 

Cast your minds back two years ago when the Labor and Liberal parties, with an election looming, promised to put significant changes to superannuation on hold – at least for the life of the next parliament.

Well, they might still meet that promise, although changes to super in May’s budget would not surprise. All the signs are now pointing to a fundamental rethink about how our system works, and sooner rather than later.

When Treasury Secretary John Fraser tells a conference that there is a need for a "fundamental rethink" of the links between super, pensions, housing and welfare, you know some serious thinking is going on in his department.

This follows a comment by Fraser’s boss, Treasurer Joe Hockey, that the system today is facing challenges not on the radar when compulsory super was established in 1992 – most notably longevity. In 1992 a man could expect to live, on average, to 72, and a woman about two years longer. Today that figure is in the mid-80s for both sexes and rising.

Then we had the release of the Federal Government’s Tax Discussion Paper that will inevitably fuel furious debate about the tax settings for superannuation and retirement benefits.

Finally, there was the establishment of a new policy forum to take a holistic look at Australia's retirement income system. With the former Secretary of the Department of Prime Minister and Cabinet, Dr Michael Keating, in the chair, as well as other super industry heavyweights, such as Professor Bob Officer and Dr Vince FitzGerald, this body has the potential to influence public policy.

All of this happened in the past week; someone with a cynical frame of mind might suspect there was an orchestrated campaign underway.

But even if the timing of this commentary is purely coincidental (and I suspect it is), there can be no doubt that in Canberra’s corridors of power our superannuation system, and its linkages to our tax and pension systems, is under the microscope.

In essence, there is nothing wrong with public policy being reviewed. That said, I think it’s critical that all our policy makers appreciate three important points.

First, every review of superannuation creates uncertainty; a system that thrives on confidence is undermined every time it is publicly challenged. That’s not an argument to say the system should be set in stone; it must evolve. But the never-ending reviews, the political point-scoring, and, to be fair, the industry infighting that causes self-inflicted wounds, often damage the system for no discernible benefit.

Second, the current system has now been in place for nearly a quarter of a century. People nearing, or in, retirement have calculated their futures based on this system, having taken to heart the philosophy underpinning superannuation – to be self-sufficient in retirement. Nowhere has this responsible attitude been more self-evident than with trustees and members of self-managed super funds. To now “punish” them for doing what they were urged to do would be a reprehensible step. At the very least, any future change must be grandfathered.

Third, it seems to me that longevity demands reinforcement of the current system; as people live longer then surely the need for them to be self-sufficient in retirement becomes even greater.

By all means let there be a public debate about super; let’s look at the retirement age, lump sums, its tax treatment, and the link to the pension and health care systems. But let’s do it in a holistic, and as far as possible, non-political way. And once it’s completed and the changes made, let’s put the cue in the rack for at least five years.

A forlorn hope. Maybe. But it’s what those people who have assumed responsibility for their retirement income rightly deserve.