The deferral of the phased-in rise of compulsory employer super contributions will not set back ordinary Australians, according to Dixon Advisory’s Daryl Dixon.
In an opinion piece in The Canberra Times earlier this week, the Dixon Advisory executive chairman said many younger groups and middle-aged homeowners would prefer additional take-home pay rather than an increase in employer super contributions.
“Even more worrying for younger and middle-aged earners is the continuous pressure from the superannuation industry and Treasury to raise the preservation age beyond 60 to as high as the age pensioner eligibility age,” Mr Dixon wrote.
Mr Dixon also said – if compulsory super is the best option to boost national savings – that there are “three major flaws” in the current policy, even at 9.5 per cent of a salary.
“First, there's no failsafe way to ensure smaller employers actually make the required contributions on a timely basis,” Mr Dixon said.
“Second, there's no compulsion for the self-employed and other non-wage earning taxpayers to contribute indeed, this is a major incentive for workers to become contractors and/or to operate in the cash economy,” he said.
“Third, it reduces the scope for lower and middle income taxpayers into home-ownership,” Mr Dixon said.
The article also argued that instead of the government helping Australians achieve home-ownership – just as the governments in Singapore and Canada do – compulsory super contributions are invested domestically and overseas by the superannuation industry.
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