In every debate about superannuation, there's a reality that is often forgotten.
The $3.3 trillion in superannuation savings belongs to workers.
It is money that hardworking Australians have earned and set aside for their retirement, and this money is supposed to be managed with their best interests at heart.
Unfortunately, what has happened over the years — and one could argue that both sides of politics have been guilty of this — is political ideology and business interests have guided decision-making on what happens to people's retirement savings.
Exit fees, and generally exorbitant fees, have been a feature of the system for years.
Although governments have taken steps to try to address the fee issue, the amount of money earned by superannuation funds managing people's money is staggering.
Excluding insurance premiums, Australians spend more than $30 billion in superannuation fees every year, according to a 2018 Productivity Commission report.
This figure has not been updated but it's no doubt grown alongside the growth of people's super balances.
The Productivity Commission review noted that just 0.5 percentage points extra in fees across a working life could reduce retirement balances by 12 per cent.
The former Coalition government introduced some changes in this regard.
It brought in an annual test on the industry that is designed to weed out underperformers and help lower the high cost of fees, or at least make it easier for Australians to work out if their super fund is charging them exorbitant fees so that they can switch to a lower-fee one.
Typical fees on an industry super fund have come down in recent years and are now typically between 0.5 per cent and 1 per cent each year.
While more can be done to improve performance and reduce fees, the federal government has turned its focus to first setting out the purpose of superannuation.
Labor wants to legislate an agreed objective for superannuation.
This objective is part of its plan to get the political "buy in" to make drastic changes to Australia's superannuation system.
But what is it proposing? Are Australians ready for it? And does it have Australians' best interests, rather than the superannuation sector's best interests, at heart?
Labor wants Australians to stop 'raiding' their super
On Monday Treasurer Jim Chalmers gave some indication where his thinking is.
The federal government has suggested that the objective of superannuation "is to preserve savings to deliver income for a dignified retirement, alongside government support, in an equitable and sustainable way".
To do this, it wants to stop Australians from "raiding" their superannuation.
This is a major ideological point of difference between Labor and the Coalition.
During the pandemic, Australians were allowed to withdraw up to $20,000 of their super over two years to help with their living costs.
It proved to be an incredibly popular policy, with about $36 billion drawn during the two financial years the super withdrawal scheme was in operation.
The policy was backed by Liberal MPs like Andrew Bragg who have long argued that people should be able to use their superannuation to do things like buy a house.
But Labor argues the policy was "messy" with an "ideologically motivated approach" and it problematic because it depleted people's retirement savings.
"Without consultation, and little consideration, Australians were forced to choose between better incomes for retirement or paying their bills," Jim Chalmers said in a speech on Monday.
"Funds were forced to liquidate assets and $36 billion of Australians' retirement savings were lost.
"Our government will take a different approach."
HESTA chief executive Debbie Blakey, who saw many of her superannuation fund members draw down their balances to nil during that period, has also argued that superannuation savings should be for retirement and not used for things like buying a home.
"I think there are other ways to deal with the housing crisis," she said.
"And although it might seem like an easy fix, there's an ample amount of evidence that actually access to super to deal with the housing crisis could actually make the housing crisis worse. So I think this objective is a really important part of being caring of what super is there for."
The problem for the government is how they get Australians — especially younger ones who are struggling to get into the housing market and deal with the rising cost of living — to accept that they shouldn't be able to draw on their retirement savings to do things like buy a home or pay off their HECS-HELP debts.
Opposition financial services spokesman Stuart Robert said on Monday the Coalition supported enshrining a definition for super, but that it should be focused on individual Australians.
"We agree there should be a purpose, and it should be about the individual and how the individual uses their money, not how the treasurer wants to use their money for his purposes," he said.
"This is members' money, it's individual Australians' money, and there's nothing more dignified than an individual Australian owning their own house."
It's no doubt going to be a heated debate over the coming months.
Tackling $52.6 billion in super tax concessions
The other major area the government wants to tackle is tax breaks on superannuation.
Currently, people can make before-tax contributions to their super, which are taxed at a flat rate of 15 per cent in the fund.
Once people retire, their investment earnings are generally tax free, and payments to individuals once they are aged 60 or over are also generally tax free.
That has allowed some people to accumulate very high balances and it is costing the federal budget tens of billions of dollars annually.
Research by The Australia Institute shows the annual cost of super tax concessions ($52.6 billion) is almost on par with the value of the entire age pension program ($55.3 billion).
"Right now, we're on track to spend more on super tax concessions than the age pension by around 2050," Mr Chalmers said.
"I'm not convinced that's a sustainable way to get to our destination — good retirement incomes for more Australians, now and into the future."
Experts agree. Two years ago, former IMF director and senior Treasury bureaucrat Michael Callaghan released the long-awaited Retirement Income Review.
This 650-page document made several recommendations including ending super tax breaks for the wealthy.
The review made clear the super system was there to support people to build their retirement income, not purely for wealth accumulation.
"Yet most retirees leave the bulk of the wealth they had at retirement as a bequest," it said.
Higher-income earners received more superannuation tax concessions than lower- and middle-income earners, the review said.
They also got the largest tax savings as a percentage of superannuation contributions over their lifetime, it said, and the largest tax concessions on superannuation earnings.
Funds including Australian Super, HESTA, CareSuper and Aware Super have all suggested there could be a $5 million cap put on people accessing tax breaks.
These calls were made ahead of the May federal budget. And Financial Services Minister Stephen Jones has indicated Labor is considering it.
"You don't have a consultation with a preconceived outcome, but I've got to say $5 million is a lot closer to the purpose of superannuation than $100 million," Mr Jones said earlier this month.
"We'll look at where the rate number is, but it's definitely something that we are considering.
"If people have got superannuation balances in excess of $100 million, or even $50 million, I think it's pretty hard to argue that that's about retirement income.
"It might be about estate management, it might be about tax management, but it's not about retirement income, and that really is not the purpose of superannuation."
Move to chase down unpaid superannuation
There is also a big issue with unpaid superannuation. That is workers not being paid their legislated compulsory superannuation.
Unpaid super costs workers an average $4.7 billion every year, according to updated figures from Industry Super Australia (ISA).
It has suggested it is hard for people to track their superannuation balances because it is often not paid fortnightly, in line with when people's wages are typically paid.
ISA says this misalignment between the super published on a payslip and the amount deposited into an account means people often do not notice their super is missing until it is too late.
Ahead of the May budget, it has called on the government to mandate more frequent super payments.
"Modernising the law to align the payment of super with wages in the upcoming federal budget would not only drastically reduce unpaid super rates, it would also boost the retirement savings of all the 4.2 million workers who are paid super quarterly," Industry Super Australia chief executive Bernie Dean said.
ISA modelling shows a 30-year-old earning the age-based median wage could be $8,000 better off at retirement if they were paid super fortnightly instead of quarterly because contributions would compound for longer if paid more frequently.
Its analysis shows that women who are younger and on lower incomes are more likely to be impacted. It said that in 2019-20 there were 1 million women who missed out on $1.3 billion, with a total of $10.8 billion lost over seven years.
Lifting the rate of compulsory super — to 12pc or 15pc?
The Retirement Income Review suggested not increasing the rate employers contribute to people's super — the superannuation guarantee (SG) rate — which at the time of the report was at 9.5 per cent but has since lifted to 10 per cent.
Both Labor and the Coalition have supported a move to increase it to 12 per cent over time. But the review said this would cost the budget more in tax breaks than it saved in Age Pension costs until 2055 and would reduce wages.
"The weight of evidence indicates an increase in the SG rate comes at the cost of lower wages growth," the report said.
Mr Chalmers on Monday confirmed the government believed "it's important that we get to 12 per cent" but rejected suggestions it was heading to 15 per cent.
"Even getting to 12, you might recall was under some political risk not that long ago.," he said.
"And so we're proud of the role that we played in arguing to ensure that we get that from, you know, being on that path to 12."
"Steven [Jones] and I … we're not trying to get it to 15. In the near term, we're trying to get it to 12."
"And we're trying to make sure people get the super that they're entitled to, we're trying to make sure that we take some steps on the gender gap."
The government has a long road ahead in meeting these challenges.