From past experience , I would be very surprised if Pica is unaware about much.
And as to the question of whether retirees have not paid their way, the answer is , no, if you have zero tax on post 60 year olds in pension phase. Let's look at your ideal form of super, which is as you describe, is no tax going in, taxed fully on the way out. Basically I would agree with that, with reasonable benefits limits. That is in fact what the original scheme was.
Now , how do you correct for the mucking around with the system that has occurred since? Not that hard actually, you tax super at marginal rates, with a correction for tax paid during contribution and accumulation. This gives you the closest approximation to the system that you describe as ideal. Certainly closer than the present system. The system is actually already in existence, and applies to sub-60 year olds in pension phase. As far as the 1.6m cap is concerned, again, that returns the system towards the original intent. Now, I would take it further , and would make people take anything outside the 1.6 mill cap, out of any concessionally taxed fund.
I would say, the franking credits changes are poor policy and not a good way of producing tax equity in this area, and wont work. But the present system is unfair , and unsustainable, and cannot survive either. cheers
