How the super system can enhance experiences for First Nations people

A new report by the Super Members Council has identified 6 sector-wide better practice principles and 5 Government-led reforms to help uplift service standards and experiences for First Nations members in superannuation.

The report, A fair retirement: Removing barriers in super for First Nations peoples, finds that while super funds are making important progress, remaining gaps in service standards, cultural safety, identification processes and the recognition of kinship structures, continue to prevent many First Nations people from experiencing the full promise of the super system.

The report was developed in partnership with First Nations Foundation and informed by lived experiences, frontline insights, and collaboration across the super sector.

The report has identified six better practice principles for super funds to deliver improved experiences:

1. Change starts at the top: genuine buy-in from leadership to adopt culturally safe and flexible practices and services.
2. Trust well-trained frontline staff to make sensible, case by base decisions, especially on death benefits and financial hardship.
3. Invest in quality training for all staff, including boards and executives, to better understand First Nations experiences.
4. Modernise rigid ID requirements and limited self-identification processes.
5. Working directly with communities and First Nations organisations helps funds understand people’s needs and provide better, more trusted support.
6. Real reform won’t stick unless funds, regulators and policymakers take a coordinate approaching to information sharing.

Ahead of Close The Gap Day, the report finds that First Nations people continue to earn significantly less on average in the workforce than non-Indigenous Australians, are more likely to have insecure jobs, and have lower lifetime super contributions as a result.

The percentage of Australian workers covered by the nation’s super system has risen from 85% in 2002 to 92% in 2022. However, First Nations super coverage still isn’t equal, rising from 70% to 78% in the same timeframe. 

Median super balances for non-Indigenous Australians and Culturally and Linguistically Diverse populations grew substantially to around $70,000 and $65,000 by 2022 respectively, while First Nations median balances were significantly lower, reaching only about $28,000 by 2022.

A key barrier identified in the report is a lack of legal recognition of First Nations kinship structures. Current super laws define dependants narrowly, often excluding culturally significant family members and limiting the ability of First Nations peoples to nominate beneficiaries in ways that reflect lived realities, community obligations and traditional caregiving arrangements.

The report recommends 5 reforms for Government and regulators to further improve First Nations experiences:

1. Explicit recognition of First Nations kinship structures in super law.
2. Enable Indigenous Australians to nominate super beneficiaries consistent with a person’s cultural kinship and social structures.
3. Clearer, sector-wide guidance on acceptable non-standard ID.
4. Greater regulatory guidance from APRA and ASIC to set minimum expectations on cultural safety and service standards.
5. Guidance and support for collecting Indigenous status information following Indigenous data governance principles.

Quotes attributable to Misha Schubert, CEO, Super Members Council

“Australia’s super system has delivered enormous benefits for millions of people, but it has not worked equally fairly for everyone — and First Nations peoples continue to face barriers that simply shouldn’t exist in a modern retirement system.”

“When super funds lead with cultural respect, flexibility and strong leadership, the experiences of First Nations members improve — but the system as a whole must lift to make those approaches the norm, not the exception.”

“Removing barriers in super is about fairness, dignity and self-determination — and it requires both industry action and law reform so First Nations peoples can benefit from their super in ways that reflect culture, kinship and lived experiences.”

Quotes Attributable to Leah Bennett, Wiradjuri and Ngiyampaa, CEO, First Nations Foundation

“Together, with the continued support of industry, we can keep driving change improving outcomes for First Nations people, raising awareness of the barriers our communities face when engaging with the financial services sector, and creating pathways for greater economic participation.

“Australia is consistently recognised as a standard-bearer for its retirement system, and there are many benefits associated with our superannuation infrastructure — yet the member experience can differ greatly across the community.

“More First Nations people are starting businesses, buying homes, and contributing to the economy than ever before, yet our participation in the superannuation system — designed to ensure a dignified retirement — remains deeply inequitable.

“Only through honest, collaborative effort across industry and elevating First Nations voices can we enact the necessary changes to remove barriers in super. Because our people deserve more than survival — we deserve security, prosperity, and a future grounded in fairness and equality.”