14 May 2024
“Many of our members are typically lower paid and facing increased pressure on household budgets as the cost of basic necessities has increased,” Ms Blakey said.
Following over a decade of advocacy from HESTA and others, the Federal Government in March this year announced super will be paid on the Commonwealth Parental Leave Pay Scheme from 1 July 2025.
Ms Blakey said for members still working, the stage three tax cuts, due also to come into effect on 1 July, would ease the pressure on household budgets. For those in retirement, Ms Blakey also welcomed the announcement that the Government would freeze deeming rates at current levels for another year, benefiting members accessing the Age Pension.
The tax changes, however, brought into focus the need for the more equitable targeting of superannuation tax concessions to help boost retirement savings for women and lower-income earners.
Ms Blakey said increasing the maximum income eligibility for the Low-Income Super Tax Offset (LISTO) from $37,000 per annum to the top of the second income tax threshold, and aligning the offset with the Super Guarantee, was a non-inflationary measure that would help make a difference to the retirement savings of women and low-income earners.
“It’s unfair low-income earners, many of whom are women, continue to pay more tax on their super contributions than their wages. That’s why we want to see the LISTO updated to reflect current tax and super settings,” Ms Blakey said.
“Reform to pay super on paid parental leave was a fantastic step forward for women’s financial security in retirement, but there’s still work to do to close the gender super gap and create a fairer super system for everyone.”
Ms Blakey also welcomed the Federal Budget’s focus on supporting Australia’s energy transition. The Government has committed $22.7b over the next decade with a focus on new industries including renewable hydrogen, critical minerals processing, green metals, low-carbon liquid fuels and cleaner energy manufacturing.
“We need to accelerate the transition to clean energy and away from fossil fuels, as this can help mitigate climate change-related risks to our members’ retirement savings, and create new investment opportunities,” she said.
“The nationwide exploration of future-facing commodities, so vital for the energy transition, is a crucial step towards scaling up mining operations, strengthening supply chains, and helping Australia meet its net zero carbon emissions target.
Budget funding to jump-start large decarbonisation projects was also welcomed, with HESTA having already committed to investing 10% of its portfolio in climate solutions by 2030.
Ms Blakey also commended Budget measures to support HESTA members, who are predominately women in health and community services. These included funding provisions for the aged care and early childhood education wage increases, more flexibility for carers, and $320-a-week ‘prac payment’ for nursing, teaching, midwifery and social work students.
“HESTA members are mainly women who spend their lives providing critical care for communities in typically lower-paid roles such as nurses, midwives and aged care and early childhood education professionals, and often take unpaid time away from work to look after others,” she said.
“These professionals already face significant hurdles in achieving financial security in retirement, so it’s encouraging to see this year’s Budget provide targeted cost-of-living relief and support for many of our members.”
Ends.
About HESTA
HESTA is one of the largest superannuation funds dedicated to Australia’s health and community services sector. An industry fund that’s run only to benefit members, HESTA now has more than one million members (around 80% of whom are women) and currently manages approximately $82 billion* in assets invested around the world.
*Information is current as at the date of issue.
