The Liberal and National party coalition's proposal to consider issuing 30 year government bonds is a sensible one that could go a long way towards addressing one of the major shortcomings of Australia's retirement savings system, and provide a significant boost to the development of the corporate bond market, at the same time. It could also provide the government with greater flexibility in managing its debt through providing another maturity (or a longer range of maturities) into which bonds can be issued and by potentially attracting a new group of investors.The proposal stems from a recommendation made in the Henry tax review that was dismissed by the Labor government. The government feared that such a move would be either portrayed or perceived as moving the country further into debt, and into debt that would take much longer to pay-off.However, this fear of probable short term political point scoring left the government with the problem that it still needs to lift bond outstandings to more than A$250 billion in 2013, to fund successive budget deficits and other expenditure. To do this it will either have to issue many more bonds into existing lines or it will need to expand the range of lines available.At the end of June there was $121 billion of nominal government bonds outstanding; spread across 13 different lines, with longest maturity being July 2022. This gives an average issue size of just $9.3 billion although obviously, there is some variation with the largest issue being the May 2013 line, with $15.5 billion outstanding.A 30 year bond would naturally attract life assurance companies, annuity providers and other long term debt investors, and not just those in Australia. Such long dated bonds are eagerly sought internationally: the US 30 year Treasury bond is widely recognised as being the most liquid government bond in the world. The May 2040 line was only reintroduced in the last two years and already has US$43.5 billion outstanding. Many of the largest countries around the globe issue 30 year bonds: the United Kingdom; France; Germany and Japan. But many medium sized countries, much more comparable with Australia, also issue 30 year bonds, such as Belgium, Canada, Luxembourg, the Netherlands and Switzerland. The latter are all countries that have well managed economies and are not deeply indebted. Moreover, the issuance of a 30 year bond would not prevent future Australian governments from returning to a position of being 'net debt' free, just as the previous Coalition government was.  In fact, this should be the ultimate goal, with a liquid and much longer dated government bond market being maintained. As alluded to above, the existence of a 30 year bond would provide the 'risk free' foundation for the provision of long term annuities in Australia.  No such foundation exists at the moment and therefore annuities, which could be used to provide a safe and reliable long term income stream for the retired population, are virtually non-existent. Retirees are left to manage their accumulated superannuation as best