There are many benefits to keeping mature-aged people in the workforce

There are real disincentives and barriers to ongoing participation. Against this backdrop Costello's superannuation policy announcements, and the support from Opposition parties, are welcome.

The proposed changes will help provide the flexibility needed to match people's choices and plans, particularly those looking to phase down their work before retirement and those choosing to continue to work and contribute to superannuation beyond age 65. However, the issues around the participation of mature-aged workers are more complicated than this.

In Australia we like to adopt a rosy interpretation of early exit from the labour force - these are the workers choosing to retire and head down the coast. However, the reality is that older people can be discouraged from an ongoing job search and they are sometimes discriminated against.

It is also clear that there is a culture of early retirement in Australia, with the vast majority of people indicating they intend to retire from full-time work before they are 65.

Because Australians are living longer, this means people are planning on spending longer periods out of employment. Unfortunately, these intentions do not match well with the financial realities at the individual or economy-wide level.

Last April the ACTU and BCA released a joint report highlighting some of the issues. The BCA has since prepared a business guide for supporting older workers.