Unions have a capacity to leverage off the Government’s new superannuation co-contributions regime to secure better returns for workers on lower incomes, according to the executive chair of Industry Fund Services, Gary Weaven.
Weaven, a former ACTU official, has told the Conference of Major Superannuation Funds on the Gold Coast that while he believes the new co-contribution regime contains some inequities, it also contains some opportunities.
He says the inequity relates to the co-contribution being calculated on net income rather than gross incomes.
But Weaven says that it is theoretically possible to build on the new co-contribution regime.
He says it is possible for unions to negotiate outcomes for lower paid workers which will see pay rises paid in the form of superannuation contributions which in turn, attract the Government co-contribution.
Weaven says that while many low-income earners will probably be loath to see wage rises flow directly into superannuation contributions, the regime is nonetheless “there to be seized upon”.
Weaven’s statement came as the Gold Coast conference was told that the number of lower income earners in Australia represented a real threat to Australia’s future retirement incomes policies.
Data presented by both NATSEM and a range of speakers at CMSF 2004 suggested that the high levels of part-time work and casualisation in the Australian workforce meant that the current 9 per cent superannuation guarantee will not be sufficient to generate adequate retirement incomes for many Australians.
Weaven’s comments follow suggestions in early March by the secretary of the ACTU, Greg Combe, that unions will seek to negotiate improvements to super as part of broader wage demands.
The ACTU has made clear that it believes the superannuation guarantee should be lifted to 15 per cent.
