Industry Super Australia welcomes Senate inquiry on women’s super
Industry Super Australia welcomes the call by the Greens for a Senate inquiry to the address the issues causing the substantial gap in women’s superannuation savings and overall retirement income.
“The failure of current settings to deliver a comfortable retirement for women is a key finding of Industry Super Australia’s recent submission to the tax review,” said Robbie Campo, Deputy Chief Executive of Industry Super Australia.
“The current 19% pay gap between women and men’s wages is a large part of the problem and translates into a superannuation gap of 47%.
“Our modelling shows that even in a fully mature super system, with super, pension payments and other savings combined, 63% of single women will still not be retiring comfortably by 2055 unless we act now to rebalance our retirement income system.“
To start closing the gap, Industry Super Australia believes the Senate inquiry should consider the following measures:
- Re-calibration of superannuation tax breaks, most of which flow to the top 1% of income earners who are predominantly male. The lowest paid, mainly women, receive no tax break and perversely suffer a 14% reduction in their superannuation income rather than a boost.
- Raising compulsory super contributions from 9.5% to 12% as quickly as possible.
- Re-instatement of the Low Income Superannuation Contribution (LISC), or equivalent, which would boost women’s super savings and cover 45% of female workers.
- Reconsideration of recent changes to the age pension asset test and their effect on savings incentives.
“With tax concessions flowing disproportionately to high earning males, the imbalance is already impacting deeply on women who make up the vast number of median to low paid workers,” said Ms Campo.
“The age pension is also a critical part of the retirement equation and recent changes need to be re-visited.
“The absurdly harsh asset test taper that was recently introduced has the potential to swallow up the benefit of any new measures aimed at improving superannuation savings for women,” she said.
According to data produced by actuaries Rice Warner and ISA, the recently legislated pension cuts will impact most heavily on middle to low income workers, mainly women, currently earning wages as little as $45,000 a year.
For further information, please contact Phil Davey 0414 867 188