Superannuation must increase to 15% and women need a better deal
The next increase in compulsory superannuation and the role of the superannuation industry are among the terms of reference in the government’s review into retirement income. The inquiry is the first of its kind since the 1990s and is designed to address issues of equity in retirement outcomes. It will likely be a major test for whether the scheduled superannuation guarantee increases, to bring the rate to 12% by 2025, will go ahead. This is despite the increases already being enacted by legislation.
In a submission to the Retirement Income Review by the ACTU, Living well after work, the Australian Union movement calls for superannuation to increase to 15% for all workers and for equal retirement outcomes for women.
The wide-ranging submission makes 23 recommendations to improve retirement outcomes for workers, make the system more equitable and to improve its sustainability and equity.
The ACTU is calling for superannuation to increase to 12% as soon as possible and a pathway to be legislated for the superannuation guarantee to rise to 15%. The ACTU also calls for women to reach 15% at an accelerated rate to help address the gender retirement gap.
“Women face retirement today with far less super than men,” says ACTU Assistant Secretary Scott Connolly, “The inequalities which have been baked into the system must be removed.”
Women, on average, retire with superannuation balances 47% lower than men. Women’s poor retirement balance are the result of compounding issues throughout working life and structures of the system.
Women need more super to achieve a dignified and independent retirement. The SG for women must increase to 15% at an accelerated rate.
“Our superannuation system is one of the labour movement’s proudest achievements,” says Connolly, “It is a world-class vehicle for workers to retire with dignity, but it is not finished. The superannuation system needs to be strengthened and rebuilt for a modern Australia, and workers’ capital should be used to improve the lives of those working while generating returns for those who are retired.”
The government imposed freeze on scheduled superannuation increases is due to be lifted, providing a pathway to 12% over the next five years. These scheduled increases have been opposed by a number of Coalition MPs.
The review received hundreds of submissions from industry groups, lobbyists, peak bodies and other concerned individuals and organisations. Submissions closed on Monday, 3 February, with the final report expected in June.
You can find the ACTU's full submission and media release by clicking here