I would like to take this opportunity to say the Government is committed to getting Australia's superannuation system right and we truly value your contribution to that process.
In just a couple of decades since the introduction of compulsory superannuation, our super system has become far bigger and more complex than many at the time could have foreseen, with developments like the growth of the self-managed super funds sector, and the massive expansion of investment choice.
Our pool of superannuation savings has ballooned to over $2 trillion dollars. And as our baby boomers retire from the workforce and the proportion of funds in the draw-down stage grows, we need to build on current strengths to make sure we'll always have a system that's sustainable and reliable, that's good for the economy, and that wins confidence by having the highest governance standards, by being robust and well-regulated.
Above all, this Government wants a system that delivers retirement outcomes for Australians.
The way to achieve this is building a system that fosters engagement and competition but also protects the disengaged. A system where people can be confident their contributions are being managed well. A system that is squarely focused on retirement incomes.
In particular, we want to facilitate better retirement products that allow retirees to improve their living standards. As part of this process, the Government will soon announce the results of our retirement income streams review.
And we're progressing work on comprehensive income products for retirement.
As I'm sure you are aware, last week I released a discussion paper as the first step towards enshrining the objective of the superannuation system in legislation as recommended by the Financial System Inquiry (FSI). An objective will guide superannuation policy and will provide a yardstick against which to measure competing superannuation proposals. It will promote greater long-term confidence and policy stability in the system.
The view that superannuation is for retirement income is widely shared, however there are a range of views within the industry and the community on what the enshrined objective of superannuation should be. This highlights the need to have an open conversation to build consensus around the wording of the objective.
Enshrining the objective is not just about government, it is about framing our ongoing conversation about the purpose of superannuation and the value it retains and returns to an ageing Australian population.
The Government's response to the FSI also involves the Productivity Commission (PC) review of the efficiency and competitiveness of the entire superannuation system. This will be a three-stage process. In the first stage, the PC will develop criteria to assess the system's efficiency and competitiveness. In the second stage, the PC will develop alternative models for a formal competitive process for allocating default members to products.
Finally, in the third stage, the PC will undertake a thorough, independent and frank assessment of whether the system is performing efficiently and competitively, or whether the Government should consider alternative policy options. We have recently announced the terms of reference for the first two stages of the review. The Productivity Commission will consult widely and I encourage you to engage in this process.
We're also looking at more measures to improve the efficiency and competitiveness of the current system. We're interested in making default super products as efficient as possible, to protect those who aren't as engaged as others with their superannuation. And we'd like to continue to improve efficiency by reducing unnecessary multiple accounts and helping reunite members with their lost super.
Our focus is on creating an efficient and sustainable system that delivers good outcomes for consumers, whether they're in retirement already, approaching this stage, or a long way off. We want to work with industry to construct a world-leading superannuation system that serves Australians well for generations to come.
I look forward to working with you in the weeks and months ahead… and for your support for enforceable world-class governance standards.
I look forward to hearing about what I'm sure will be a very rewarding conference.