How Nicholas Pensions plans to help pensioners save for their retirement
The pensions of pensioners in Australia are facing a significant overhaul as a result of a controversial proposal by Nicholas Pills, the company that runs the Australian Government’s pension scheme.
The pension fund’s chief executive, Tony Loughton, has been in the public eye since last week’s release of a report commissioned by the company which said there was no guarantee the Government’s $12 billion plan would be funded and that the plan would “fail in its original funding plan”.
“We have been clear about our commitment to ensure that the funding provided by the Australian government will continue and that there will be no reduction in funding for pensions in Australia,” Mr Loughston told the ABC.
“The plan has been designed to be able to sustain its financial viability, to be funded by an even higher level of contribution from the Australian public.”
The report commissioned for the $12.6 billion Newstart Allowance scheme also found the plan could fail if the Government does not “immediately and dramatically reduce the projected increase in unemployment from its current forecast of 1.3 per cent to 1.5 per cent”.
While Mr Lighton has not yet provided a timeframe for when the plan will be funded, the Treasurer said it would be “imperative” to start work on the plan in the first half of next year.
Mr Loughson has previously said the plan was not in danger of collapse.
Key points:AAP: “There is no guarantee” the plan “will survive the funding plan review”Nicholas Pills says there is “no guarantee” it will survive the “fundamental review”The Federal Government has committed to delivering the Newstart Guarantee and other income support benefits to all Australians by the end of the year.
However, it is understood that the new plan will now be “reviewed” by the Pills plan, which will look at its “fundamentals”.
“It will take a detailed look at the plan’s viability and the way it is operating to determine whether there is a realistic expectation that it will be able or able to survive the fundamental review of the plan,” Mr Treadwell said.
Mr Lighson told the Senate this week the plan is not in jeopardy of failing because the Government “is committed to making sure that our funding plan remains funded.”
He said he has been “deeply involved” in the review process, but said he “can’t discuss” details of the review “due to the sensitivity of the subject”.
“The Pills Plan is a critical part of Australia’s economic recovery, and this review is the right way forward for it,” Mr Mr Laughton said.