AUSTRALIA'S superannuation funds recorded the second worst investment performance among the 30 OECD countries in 2008.
Forced superannuation tends to result in a misallocation of scarce resources to uses that are not optimal for many people. It's the classic "one size fits all" mentality that plagues all socialist policies: regulatory solutions that consequently stifle the free market's innovation and creativity and in the process restrict competition by raising entry costs. Friedrich Hayek referred to this as the "pretense of knowledge" syndrome infecting central planners. If the government really cared about its people it would stop meddling; order and fairness come out of the spontaneous interaction of thousands of voluntary free market transactions, not from latest political scheme concocted to win votes.
Our superannuation industry is heavily regulated by the government and hence utterly inefficient and wasteful. It's no surprise that they performed so poorly when the only people who gain are those who sit on the massive cash piles raking in fees and bonuses. Savings are supposed to benefit the saver not the fund managers who at the first sign of trouble will call in unison with their governmental allies for increases in forced Super contributions.
Arguably more dangerous are the misallocations it causes. Superannuation has contributed to a lack of personal savings and increased debt over the years as it gives people a false sense of security, a nest egg that might not actually be there when they retire. This creates a dangerous mentality when you consider that super accounts are mostly not savings (deposits/gold) but consist almost entirely of financial assets (equities) or 'paper' savings (probably significantly tied up in the mining and housing bubbles too).
The OECD Pensions at a Glance 2009 report also notes Australian seniors had the fourth highest rate of old-age poverty in the OECD in 2006, more than double the average.
"Public pension spending is only 3.5 per cent of national income in Australia compared with an average of over 7 per cent of GDP in OECD countries.''
This is a classic Argumentum ad populum, where "if many believe so, it is so". Just because the rest of the OECD - the ones who appear to have an old-age 'problem' that makes ours pale by comparison - force their people to subsidise old age does not make it the right solution for us. In fact, the correct solution would be to abolish all future public pension spending and end this mess before it gets out of control (people currently on pensions should continue to receive it - this is a delicate issue and needs to be phased in slowly as the government promise of a pension has caused many people to alter their intertemporal preferences and hence over consume).
The state's involvement in retirement security creates calculational confusion, resource misallocation, mismanagement and free riding. The real cost of the current mess will be borne by future taxpayers, who are paying for the pensions of the present retirees but can expect to receive little in return. As I've mentioned before (here and here), retirement and government pensions are a state-created concept full of economic inefficiencies, promoting waste and irresponsibility. We need to let people decide for themselves, to let individuals and families make rational and responsible decisions that enable them to provide for their old-age needs. Phasing out old-age benefits and returning to sound money so that people can actually save for the future would be a good start.
For the second part of this post, Australia Post is raking in the complaint letters! Consumers have no alternative as the government forbids competition so their only recourse is to complain; in a free market they would simply vote with their wallets and Australia Post would be out of business if they did not clean up their act,
Australia Post received 65,000 complaints in 2007 about failures to redirect mail.
"Australia Post and its staff need to be a little more responsive to the problems that people can encounter," he said.
"[It needs to recognise] that this is a real problem for Australia Post and can cause real disadvantage and inconvenience to people is part of the solution."
Mr McMillan says the organisation's response to complaints also needs to be addressed.
This has been covered to death, but with no profit motive, I am not optimistic that they will address their "issues"...there's no incentive to!
With all of these problems the simplest solution is often the best: get the government out of the way and let the free market work.