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Pro rata super model will help failing system
A pro rata model of compulsory superannuation contributions would address the super system that is failing young people, Vision Super and the John Curtin Research Centre believe.
In an upcoming joint report, the organisations said the pro rata model would address the disappearance of traditional nine-to-five jobs and the emergence of the “gig economy”.
The John Curtin Research Centre’s executive director, Dr Nick Dyrenfurth, pointed out that a third of young people were missing out on super contributions because they did not reach the $450 threshold from a single employer.
“In decades to come, if a third of the workplace has no retirement savings, it will have a massive impact on the Age Pension,” he said.
Vision Super chief executive, Stephen Rowe, said the super system was failing young people as work had changed since the system was designed.
“There is a growing problem that will require sophisticated, bipartisan public policy solutions to prevent millions of Australians falling through the cracks,” Rowe said.
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