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Maven "build path specifies execution environment J2SE-1.5", even though I changed it to 1.7

In Eclipse Juno, I installed the latest m2e plugin (1.2.20120903-1050). In preferences, I have added jdk1.7.0_11 in Java -> Installed JREs -> Add, and then specified the location (C:\Program Files\Java\jdk1.7.0_11). When I create a new Maven project and run it, I get a warning:

Build path specifies execution environment J2SE-1.5. There are no JREs installed in the workspace that are strictly compatible with this environment.

I am not sure how to resolve this.

I believe it is a Maven problem because I do not have this error when I run normal Java projects. I read here that I should change the "maven-compiler-plugin.pom" and change the source and target from 1.5 to something more appropriate. In my case, 1.7. I have done this, but I still get the warning.

Solution
    1. Right-click on your project
    2. Click Properties
    3. Click the "Java Compiler" option on the left menu
    4. Under JDK compliance section on the right, change it to "1.7"
    5. Run a Maven clean and then Maven build.