SMC calls for Budget changes to improve female super outcomes
A new report and pre-Budget submission from the Super Members Council (SMC) have detailed several opportunities for the Federal Government to improve superannuation outcomes for females and implement structural, long-term changes.
The report, titled Securing a Dignified Retirement for More Women, said low-income women could earn approximately $40,000 more in superannuation if it was paid on Commonwealth Parental Leave and by better aligning tax offsets.
A woman with two children could have $12,500 to $14,500 more at retirement if super was paid on Commonwealth Parental Leave. This, combined with increasing the low-income superannuation tax offset (LISTO) for workers paid up to $45,000 to receive a full tax refund on their superannuation guarantee (SG) contributions, could leave lower-paid women with $38,000 more at retirement or 21 per cent.
SMC Interim Chair, Nicola Roxon, said these are only some of the “persistent barriers” to countless women achieving financial security in retirement, with structural, “considered [and] society-wide” change needed to bridge this perceived gender gap.
“Super has transformed the lives of millions of Australians, yet for many women, who retire earlier and live longer than men, the system is still falling short,” she said.
“Paying super on parental leave and better aligning tax offsets for lower paid workers can be enacted almost immediately and will make a meaningful difference to women at retirement.
“We need to ensure super tax concessions are directed to those who need it the most.”
Also, in the council’s first pre-Budget submission since its amalgamation of Industry Super Australia and the Australian Institute of Superannuation Trustees, it encouraged the implementation of several other measures to improve equity in super and retirement outcomes. These included:
- formally recognising traditional Indigenous kinship arrangements inside super;
- setting unpaid super compliance targets for the ATO;
- paying super to all under-18 workers, not just those who work for more than 30 hours a week, to provide an additional $2,600 in super contributions to the average underage worker; and
- improving data sharing arrangements, so tax data can inform the targeted retirement solutions provided to members by super funds.