Australians call for urgent payday super legislation as unpaid super bill blows out further

Australians say they want to see crucial payday super reforms start next July as promised, as new analysis shows unpaid super is costing Australians $5.7 billion in lost retirement savings each year.

Based on recently released taxation data from the ATO, the analysis by the Super Members Council (SMC) finds the amount of super going unpaid to Australians has increased by $600 million on the previous year. It means workers are losing $110 million each week in unpaid super – a loss that can only be curbed by payday super laws.

It comes as a new survey for SMC by Pyxis Polling and Insights of more than 1,000 Australians finds more than 70 per cent want payday super laws to come into effect on 1 July 2026. Fewer than one in ten people think the laws should be delayed.

SMC urges the Government and Parliament to get on with passing payday super legislation in the first 100 days of the new Parliament. These urgent laws will help 3.3 million Australians with unpaid super to be paid on time and in full.

In its submission on the payday super exposure draft legislation, SMC recommended a series of small but important changes to give employers the support and confidence they need in the transition to the new payment regime, smoothing the path to implementation.

These include extending the payment processing deadline from 7 calendar days to 7 business days, taking a phased approach to ATO enforcement in the early stages to give comfort to employers genuinely trying to do the right thing, and letting employers validate a worker’s correct super account details at any time to prevent processing errors.

With digital payroll and single touch payroll reporting systems now available to all employers, many already pay super more frequently than quarterly. As of 2020-21, 56% of all small and medium businesses made super payments more frequently than quarterly. 

SMC analysis finds:   

• In 2022-23, 3.3 million Australians missed out on $5.7 billion in super entitlements 
• Over the past decade, Australians have missed out on more than $47 billion in unpaid super  
• The average affected worker missed out on $1,730 in super in 2022-23 
• More than one million people were underpaid super in New South Wales and more than 848,000 in Victoria (see table)  
• Unpaid super can cost the average worker more than $30,000 from their final retirement nest egg.

By 1 July 2026, Australian workers will have waited three years for payday super reforms and SMC Deputy CEO Georgia Brumby says Australians will pay the price for any further delays.

“The message from Australians to all Parliamentarians is loud and clear on passing payday super laws: just get on with it,” she said.

“Each week these laws are delayed, Australians are made $110 million poorer in retirement which means less money to pay the bills after a lifetime of hard work.

“The sooner this legislation is introduced and passed, the more time and certainty it will give businesses and the super payment system to prepare – so all workers can get paid their super on time and in full.

“Payday super will not only stamp out unpaid super – it’ll put nearly $8,000 more in the average Australian’s pocket at retirement, thanks to more frequent payments and the power of compounding.”

Table – Unpaid super by state and state Super Guarantee population

The opinions above are those of the author in their capacity as spokesperson for Super Members Council (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.

Mike Dolan
0474 909 471
[email protected]