FSC calls for super guarantee increase by 2022
Financial Services Council chief executive Sally Loane will call for the superannuation guarantee to be increased to 12 per cent three years sooner than currently planned by the federal government.
In a speech to be delivered at the Financial Services Council conference, Ms Loane will call for bipartisan support for the SG increase by 2022.
Currently frozen at 9.5 per cent until July 2021, the SG will gradually increase to 12 per cent by July 2025.
The former Labor government passed laws to increase the SG to 12 per cent by July 2019, but the current Coalition government has pushed back the starting date until 2025.
In her speech, Ms Loane will point to FSC-commissioned Rice Warner research that found the pause in the SG increase has resulted in a "$136 billion blow-out in the retirement savings gap".
"On the current trajectory, the savings gap is increasing," Ms Loane said.
"Today, the Financial Services Council is calling on the government and the Opposition to commit to increase the superannuation guarantee to 12 per cent by 2022," Ms Loane will say.
"This will mean Australians entering the workforce in that year – the 30th anniversary of compulsory superannuation – will receive the full benefits of superannuation during their working lives and will be in a position to retire with adequate savings.
"The government's commitment to no negative changes to super tax, and not touching super in the May Budget has been a welcome reprieve after years of tinkering," Ms Loane will say in the speech.
"With average balances still low – at $70,000 for women and $110,000 for men − and compulsory contribution rates paused at 9.5 per cent until 2021, Australia's superannuation system is a long way from achieving its objective."
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