Threshold removal more ‘equitable’ for super

New analysis and estimates conducted by Rest on its superannuation member base found the removal of the $450 monthly income threshold for super guarantee (SG) contributions has edged closer to a more equitable super system.

Analysis of Rest’s member contributions during the 2022/23 financial year showed approximately 260,000 members received super for every hour they worked since the threshold was removed on 1 July 2022.

Rest said 64 per cent of the members were female, and 69 per cent were existing members who received additional contributions they were previously unlikely to receive with the threshold in place.

“The removal of the $450 income threshold has offered more than a quarter of a million examples of the power and value of reform efforts to build a fairer and more equitable super system,” Rest CEO Vicki Doyle, said.

“This finding highlights the benefit to Rest members, but it’s likely many more working Australians are now receiving super for every hour they work as a result of the change.

“Women were overrepresented among the 260,000 members and therefore more likely to benefit from this change. This was particularly the case for those aged between 40 and 59. As a result, the change will contribute to closing the gender gap in superannuation balances, which is around 26 per cent for Rest members aged 60 to 64.”

Doyle said the data analysed by Rest should also serve as a stepping stone to implement further superannuation reforms, including super contributions paid on parental leave.

“Coupled with the introduction of payday super and plans to increase the visibility of unpaid superannuation, there has been some encouraging progress towards greater fairness and equity recently.”