The change announced on Tuesday will impact about 80,000 Australians and is expected to raise $2 billion in the first full year and $3.2 billion over five years, which will go back into the budget rather than be spent.

Treasurer Jim Chalmers says the changes are modest but meaningful.

“Overwhelmingly, this is about one thing, responsible economic management,” he said.

“The changes are about making superannuation more sustainable by making the tax breaks more affordable.”

Dr Chalmers added the government had struck the right balance with the $3 million threshold instead of lowering it to boost revenue.

He said the superannuation system was world class but had two major imperfections.

“The cost of the tax breaks for people who don’t need them, and the gender gap in balances,” he said.

The treasurer said the government needed to make difficult decisions in not putting the money towards paying super on paid parental leave.

“When we can afford to pay superannuation guarantee on paid parental leave we would like to, but this change is about budget repair.”

Shadow treasurer Angus Taylor said it was clearly a broken election promise from Labor after promising not to make superannuation changes this term.

“Australians don’t want to see a government that can’t manage its own spending and has to come after Australians with higher taxes,” he said.

But the prime minister is maintaining the government has stuck to its commitment by ensuring the policy is taken to an election before being implemented.

Albanese said it was hard to argue super accounts with balances of $3 million or more were about “actual retirement incomes”.

“There are 17 Australians who have over $100 million in their superannuation accounts and one has over $400 million,” he said.

“Now most Australians will would agree that’s not what superannuation is for, that’s not about providing for people’s retirement incomes.

“That’s why this change is important.”

Greens leader Adam Bandt, whose party’s Senate support will be needed to pass the changes, said he would discuss the plan with Labor, but the “modest proposal” ignored other more responsible budget policies.

“Let’s look at reining in the stage three tax cuts,” he said.

Richard Denniss, from the Australia Institute, said superannuation tax breaks were unsustainable and inequitable.

Tony Negline, from Chartered Accountants ANZ, said the change would have a big impact on a small number of people who had played by the rules.

Albanese ruled out changes to capital gains tax exemptions.

“We are not going to impact the family home, full stop, exclamation mark,” he said.

-AAP