POWERED BY MOMENTUM MEDIA
Improve super for regional and low-income Aussies: HESTA
There are opportunities in the May 2023 Budget to improve the retirement balances of low and middle-income earners, many of whom are based in regional Australia, HESTA modelling suggested.
The super fund noted that more than 400,000 of its members lived outside metropolitan areas and had an average salary that is 11.6% lower than a HESTA metropolitan member.
Better targeting of tax concessions and paying super on the Commonwealth Paid Parental Leave (PPL) pay scheme could deliver a fairer super system for these members, it said.
“Superannuation is driven by a fundamental belief that dignity in retirement is for everyone, not just the lucky few. It’s time to acknowledge the gaps in our super system,” said Debby Blakey, HESTA chief executive.
“Low- and middle-income earners, many of whom live in regional Australia, as well as many women need solutions sooner than later to address the gaps that currently sees them retiring with far less security than they should.”
By introducing equity measures like super on PPL, mothers could see their super increase anywhere between 3.7% and 11%, HESTA pointed out.
Consulting firm Mercer had also voiced its support for super contributions on PPL in its pre-Budget submission.
In its recommendations to Government, HESTA advocated for extending eligibility for the low income super tax offset (LISTO) to those earning up to $45,000 and bringing the offset in line with the current Superannuation Guarantee (10.5%).
Additionally, it recommended introducing a carer’s credit to assist those taking unpaid parental leave rebuild their super and scrapping super tax concessions flowing to accounts with balances of more than $5 million.
“Every dollar our members can add to their super counts. That’s why the Federal Budget is a key opportunity to make real progress on boosting women’s financial security in retirement,” Blakey added.
“This is a critical year for super to address longstanding inequities that overwhelmingly impact women, as they shouldn’t be financially penalised after spending their lives caring for others.”
AUTHOR
Rhea Nath
Rhea L Nath is a journalist on Super Review and InvestorDaily, with a focus on funds management, superannuation, and institutional investment. Previously, she covered small business and entrepreneurship news at Dynamic Business and multicultural issues at Indian Link Media Group. In 2022, she was named Young Journalist of the Year at the NSW Premier’s Multicultural Communications Awards.
Recommended for you
A ratings firm has placed more prominence on governance in its fund ratings, highlighting that it’s not just about how much money a fund makes today, but whether the people running it are trustworthy, disciplined, and able to deliver for members in the future.
AMP has reached an agreement in principle to settle a landmark class action over fees charged to members of its superannuation funds, with $120 million earmarked for affected members.
Australia’s second-largest super fund is prioritising impact investing with a $2 billion commitment, targeting assets that deliver a combination of financial, social, and environmental outcomes.
The super fund has significantly grown its membership following the inclusion of Zurich’s OneCare Super policyholders.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
76.97 3 y p.a(%)
2
Global X 21Shares Bitcoin ETF
76.46 3 y p.a(%)
3
UBS Solactive Global Pure Gold Miners UCITS ETF Dis USD
51.13 3 y p.a(%)
4
Global X GlobalX FANG+ ETF
45.15 3 y p.a(%)
5
Select Baker steel Gold Institutional
43.78 3 y p.a(%)
