Royal Commission into banks and super funds

The Federal Government decision to spend $75 million on a Royal Commission to investigate the banking and finance industry will add to the country’s fiscal deficit. About the only good point is that the Royal Commissioners will investigate superannuation funds as well as banks. Compulsory Super has been a crock for all baby-boomers. It's OK for the high flying GenYers and subsequent generations with its generous tax breaks. But for those about to retire it has been useless. After a lifetime working and paying taxes those around 65 and 70 get little except the prudent savings accumulated over the years. One 70 year old has just cashed- out his super – the princely sum of $18,500. For most of the working life of people that age, superannuation contributions from employers were not available. Following the introduction of compulsory super, many only had limited part time employment and may have been largely self-employed. - taking meager living expenses out of business income.With a low level of disposable income, there was no opportunity to take advantage of tax breaks and shovel thousands of dollars into a super fund. It would have been far more beneficial for them if they had been given the opportunity to invest the money taken in super rather than see the funds disappear in management fees. Investing the money in property would have seen it grow into a real nest egg. Thankfully from earlier investments, retirees won't go hungry – but they probably won't be able retire anytime soon. The concept of compulsory super was more about providing a massive slush fund to prop up the share market and the financial services industry. If Keating had been serious about super providing retirement income, fund management fees would only have been levied on profits made by the funds each year – instead of being skimmed off the top of total funds under management.