Payday super will benefit women

Oksana Patron

30 March 2023

Modernising the law so that super is paid on payday will be help workers, and women in particular, to keep track of payments, according to the Industry Super Australia (ISA) report.

The ISA estimates indicate that this policy solution could help reduce unpaid super by at least 15%, while boosting retirement savings of all the 4.2 million Australian workers who are paid super quarterly.

The “Super Solution: How Payday super will benefit women in retirement”  report found that the outdated 90s era law, which allows super to be paid quarterly, contributed significantly to the unpaid super scourge.

According to ISA modelling, a 30-year-old earning the age-based median wage could be $8,000 better off at retirement if paid super fortnightly instead of quarterly, because contributions would compound for longer if paid more frequently.

Payday super is:

• The most effective solution
• Better for business: by eliminating red tape and allowing smoother payroll management
• Women would be better off now and into the future
• Affordable and a long-term revenue positive to the Budget.

Women remained the most affected group with, on average, a third less super than men when they are approaching retirement.

According to data from ISA, younger women on lower incomes were greatly impacted – almost 40% of women in their 20s earning less than $25,000 were short-changed. On average this cohort missed out on $570 a year and one in four women under 40 have been ripped off.

The analysis which reviewed the 2019-20 tax file showed that one in five women were underpaid super and the super swindle cost women a staggering $10.8 billion over seven years.