Some Policy Issues in Providing Retirement Incomes
AbstractThe paper compares and contrasts the pay-as-you-go system of government provided age pensions funded from recurrent tax revenue with the pre-paid system based on a compulsory superannuation levy funding an actuarially fair retirement income. Under special assumptions, including constant levels of GDP, the two systems are similar. However, given specific details of the current Australian versions of these two systems, the second system is shown to result in a higher level of GDP. Some policy design issues for the superannuation scheme, including the need for compulsion and at what rate, who pays the levy and the congruence of various eligibility ages, and the effects of the 2006 budget changes on the taxation of withdrawals, are assessed.
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Bibliographic InfoPaper provided by Melbourne Institute of Applied Economic and Social Research, The University of Melbourne in its series Melbourne Institute Working Paper Series with number wp2007n06.
Length: 24 pages
Date of creation: Feb 2007
Date of revision:
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This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-01-05 (All new papers)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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