A commitment to an increase in the superannuation guarantee to (SG) 12 per cent and a contributions tax rebate for low-income earners are at the top of the Association of Superannuation Funds of Australia’s (ASFA) pre-Budget submission wish list.
Those two measures would result in higher take home pay and higher retirement savings and retirement incomes than the measures proposed by the Henry Review, at lower cost to the Budget, according to ASFA chief executive Pauline Vamos.
An average wage earner on $60,000 a year would receive net superannuation contributions around $560 a year higher with an extra $65 per year in take home pay under these measures compared to the Henry Review proposals, according to ASFA data.
The ASFA submission also recommended the removal of the $450 per month earnings threshold for receiving SG contributions, which would benefit around 200,000 women and 130,000 men, who could receive $1,000 or more of superannuation contributions each year.
ASFA also called for two measures that would particularly address the retirement adequacy of women — the introduction of superannuation contributions on paid parental leave, and for the contribution caps for concessional contributions to be fixed at $50,000 for those under 50, and at $100,000 for those aged 50 and over.
“Now is the time to allow people, particularly women, with lower account balances and lower incomes to start to catch up,” Vamos said.
“Policymakers need to be mindful that there is significant community interest and awareness of adequacy and superannuation and the need for the Budget to address this.”
