As the nation heads to a Federal Election on 3 May, the Super Members Council has pressed all candidates and parties to pledge to keep super strong for 17 million Australians.
This includes ruling out support for any policy changes that would harm the financial interests of millions of everyday Australians – and damage the living standards of retirees after a lifetime of hard work.
SMC has written to candidates and parties today seeking their formal pledges on 12 key policy priorities to safeguard Australia's super system – and make it even stronger, simpler and fairer.
The Council has sought clear commitments to pass crucial payday super laws to recover $5 billion a year in unpaid super, and an urgent boost to a super tax offset for 1.2 million low-paid Australians.
Super Members Council CEO Misha Schubert said 17 million Australians now had retirement savings in super – with 11 million choosing a super fund that is run only to benefit its members.
She said protecting the fundamentals that ensure the strength and success of super for those millions of Australians was the highest priority.
“Australians deeply value their super – especially as they head towards and move into retirement,” she said. “If you ask Australians what they want most from super policy, the first thing they tell you is this: they want politicians to keep their super strong.”
Four in five Australians (81%) say super will be critical to their wellbeing in retirement, and 69% say it contributes to their sense of financial wellbeing now.
This week’s federal Budget revealed a surprise $9.7 billion super tax windfall due to faster than expected use of COVID-era tax credits. SMC argues this windfall should swiftly fund a $500 million-a-year super boost to strengthen retirement for 1.2 million low-income Australian workers.
The urgent need to lift the Low-Income Super Tax Offset was further highlighted by the tax cuts that passed the Parliament this week – which will cut the lowest tax rate from 16% to 14% by 2027.
This means low-income earners will soon be paying a higher rate of tax on their super than they pay on their take-home pay – when the tax rate on super is meant to be lower than on take-home wages.
The council also wants to end age discrimination by removing exclusion that denies guaranteed super for under-18 workers.
“Ensuring super is paid for all workers and remains saved and earning compound returns until retirement, are what makes the system so effective to grow people’s savings,” Ms Schubert said.
"Every candidate should reject proposals that undermine these principles, including the early withdrawal of super - which would just make Australians poorer.”
“Fixing the scourge of unpaid super is also urgent. The 2.8 million Australians who miss out on some or all their super contributions each year cannot afford to wait a day longer for these reforms.”
“Strong bipartisan support for payday super is crucial, and we urge all parties to pledge backing for it.”
Removing an outdated law denying most teen workers up to $10,000 from their retirement savings is another critical fairness measure.
“Under-18s currently don’t qualify for super unless they work more than 30 hours a week, a discriminatory rule that’s also challenging for businesses to administer. Australians strongly support universal super and fixing this outdated exclusion is long overdue.”
SMC will publish the pledges from candidates and parties before the election.
“Australia is far ahead of the global pack in solving the policy question of how to fund retirement,” Ms Schubert said.
"We ask all candidates to commit to safeguard the strength and success of Australia’s world-leading super system – and make it stronger and fairer for all.”
SMC’s 12 key super policy priorities are:
No changes to super system fundamentals
1. No changes to the principles of preservation, universality and compulsion, which protect the super of millions of everyday Australians.
2. Fix unpaid super, which costs 2.8 million Australians $5 billion a year.
3. Stick to the promised 2025 rise in the super rate to 12%.
Improve the experiences of super members during work and retirement
4. Help Australians to get an even clearer picture of what their retirement could look like with better retirement planning tools and information.
5. Let retirees pay super into retirement-phase super accounts.
6. Expand financial advice so Australians can get the retirement information they need.
7. Digitise binding death nominations and standardise death certificate and proof of identity processes to speed up death benefit payments.
8. Better integrate super funds with key government agencies to speed up hardship applications.
Make super even fairer for everyone
9. End age discrimination by paying super to all workers under age 18.
10. Lift the Low-Income Super Tax Offset so 1.2 million workers on lower incomes get a fairer super tax deal.
11. Reform the law so family violence perpetrators can’t inherit their victim’s super.
12. Improve equity for Aboriginal and Torres Strait Islander people including by recognising kinship structures and making ID requirements simpler.
The opinions above are those of the author in their capacity as spokesperson for Super Members Council of Australia (SMC). SMC, the authors and all other persons involved in the preparation of this information are thereby not giving legal, financial or professional advice for individual persons or organisations.
About us:
We’re a strong voice advocating for more than 11 million Australians who have over $1.5 trillion in retirement savings managed by profit-to-member super funds. Our purpose is to protect and advance the interests of super fund members throughout their lives, advocating on their behalf to ensure super policy is stable, effective, and equitable. We produce rigorous research and analysis and work with Parliamentarians and policy makers across the full breadth of Parliament.
Contact details:
Matt Read | +61 432 130 338 | mread@smcaustralia.com