Key items under Labor’s proposal include paying the superannuation guarantee for workers on parental leave as well as the removal of the $450 per month minimum earnings threshold for SG payments.
Other proposed measures include amending the Sex Discrimination Act 1984 to allow businesses to make higher ‘catch up’ super contributions to their female employees, and a consideration of how future super changes would impact women via an annual women’s budget statement and ensuring super tax policies are reviewed every five years.
The Financial Services Council director of policy and global markets Allan Hansell said employers and super funds should be encouraged to go even further to innovate their super offerings to help close the gender gap.
“The FSC has for many years paid super contributions for our own staff while on parental leave, as do some of our members,” Mr Hansell said.
“Another recent innovation has been for some super funds to introduce fee freezes for new parents. All employers and funds should think about what more they can do to boost retirement savings.
“Labor’s plan should be commended for helping all Australians, especially women, achieve a comfortable retirement.”
Chief executive of industry super fund HESTA, Debby Blakey, said scrapping the $450 threshold was long overdue.
“This $450 threshold means that women, who are more likely to work in part-time and casual roles, particularly in our health and community services sector, can miss out on the benefits of super entirely,” Ms Blakey said.
“We’d encourage employers to undertake a comprehensive pay equity analysis and commit to closing any gender gaps.
“By doing this they ensure that women in their workplaces are on an improved trajectory to a more financially secure retirement.”
ifa approached the AFA and the FPA but they did not return our requests for comment.
The FSC are trying their best not to appear like sycophants – its not working – these measures are at best tokenistic –
but what kind of tokenism – linking low super balances for older women and things not being fair” and now the labor media machine spins this altogether as a centrepiece – again the lefties have taken women for a ride on the equity band wagon.
Low super balances are a function of low engagement and low contribution = there may well bigger fish to fry – family, community support etc for women – Across the country employment patterns have changed – we are becoming a nation of service industry roles – we get paid less – and no surprise we don’t contribute as much to our retirement savings – this effects those with disrupted work patterns (for what ever reason). – If the pollies spent more time on making it a viable business environment and heaven forbid grow the pie – as distinct from token grabs at populism we might have more a chance of an equitable outcome. But hey – that wont fill the press pages – well at least not the Fairfax ABC press.
Really don’t understand this whole women have less super issue. If they are a member of a couple than it is the total assets the couple have which will determine their retirement, inside or outside super. If it is issue for the couple which I can’t see why it would be then split the super each year.
As mentioned the $450 per month is designed to simplify the small little payments you may make to an employee to do a few hours here or there.
Think about all the non-perfect-world scenarios where people (not just women) are missing out on super because of that $450 cap.
– people that work small amounts because they’re studying, raising a family, have health issues, or looking after elderly parents, etc
– people getting back into the work force that are starting on casual or part-time rates
– people that are working multiple jobs to make ends meet and aren’t earning quite enough in any of them to reach the $450 threshold
– people that work part-time or casual that won’t be given extra hours beyond the $450 cap, because the employer knows they’ll then have to pay super
Those are the kinds of people who’re missing out on super. They’re often the people that can least afford to do so.
Those ‘small little payments’ add up.
The issue is just PC nonsense.
1. The main reason women have less super than men is divorce – not some imaginary pay gap. In general men retain their super and women take the house. More divorced women own a house than divorced men (see ABS statistics), and
2. If you take time out of the workforce for children or anything else in fact, you will have less super.
I’m with you. If joint ownership of bank accounts or property was not allowed, then the gap between “womens and mens bank accounts” or “womens and mens home ownership” would completely dwarf the gaps being discussed about in super. But as you say, it’s not really an issue in couples because assets are pooled and jointly used regardless of legal ownership structures. And in the event of divorce one partner’s super can easily be split and reallocated to the other as part of a broader division of total assets.
Why do you assume a woman is a part of a couple? What about women who are single/divorced/widowed? What about same sex couples of two women? Though we should also consider that not all women have ‘less super’, on the whole the ‘average’ woman has less than the ‘average’ man for a few reasons. Women, statistically, tend towards lower remunerated fields for example school teaching, childcare and nursing. Women also tend to require some time out of the workforce for childbirth(until science advances this is still a female only thing) and then often for early years of child care. Now, men can stay home to raise kids too, its just not as common in our society at this point, so its impact on retirement savings is currently being felt mostly by mothers. Perhaps the changes should be phrased as being more about supporting any person regardless of gender who takes time away from employment(stays at home or only works part-time) to raise the future generation, because these measures are not female specific.
Yeah I agree. I think the issue with this whole thing is few people are transparent about why its like this. You’ve nailed it by saying women have more time off and gravitate towards lower paying jobs (due to flexibliity and lower stress levels). Is there anything wrong with that? Absolutely not.
What does need to stop is this whole ‘pay gap’ being about discrimination myth. Never going to be able to address the issue until we speak about it accurately and transparently. Many of the most successful and capable people I know are women but they choose to be more career focused over family focused. They find it offensive success is often put down to ‘discrimination’.
Remove the $450 cap; there’s a great idea. Good luck to the employer trying to send $9.50 to a super fund for the $100 they paid to an employee. The minimum was introduced for a very practical reason; to reduce the chances of small contributions being eroded by administrative costs. Nice idea, in theory. Unworkable, in practice.