The Australian Institute of Superannuation Trustees (AIST) has expressed disappointment at the Federal Government’s failure in its Budget to take more action to improve retirement savings outcomes for women.
AIST CEO Eva Scheerlinck said the Government had missed another opportunity to improve the fairness of the superannuation system by not introducing the measures the peak body for profit-to-member funds had been calling for on behalf of millions of working Australians.
“We’re disappointed the Government has failed to take action such as introducing super on paid parental leave, assessing the financial coercion of women using the early release of super scheme in the early days of the pandemic, and more effectively addressing the gender pay gap,” Ms Scheerlinck said.
“This is in addition to-recommitting to the legislated timetable for increasing the super guarantee (SG) increase to 12% by 2025, which would help all working Australians.”
Ms Scheerlinck said parental leave was the last paid leave without super, a situation which disadvantaged women most because they accounted for more than 90% of all parental leave taken by primary carers.
“For every dollar a man earns, a woman earns 67 cents on average, and women have 40% less superannuation on retirement and live longer,” she said.
“Closing this anomaly would allow parents to continue building their retirement savings while taking time out of the paid workforce to care for children and family.
“Although the Government has extended the length of paid parental leave by two weeks in this Budget, it’s disappointing this was not accompanied by an announcement it would include super.”
She repeated AIST’s call for the Government to undertake a comprehensive assessment of the number of women who were coerced into withdrawing from their retirement savings during the early release of superannuation scheme and the impact on their retirement.
“This information is critical in informing future policy decisions and avoiding unintentionally facilitating abusive behaviour and also aligns with the Government’s commitment to end family violence,” Ms Scheerlinck said.
“We also note the extension of the temporary reduction in the minimum drawdown rates of account based pensions, but this mostly benefits people with larger balances, and many retirees simply don’t have enough in super to be able to support themselves if they halve what they get from their account based pension ,” Ms Scheerlinck said.
“To sum up, there’s not enough in this Budget for women, who are behind the retirement ‘eight ball’, earning 33% less and having 40% less super than men, living longer than them and spending more time out of the workforce caring for children and family.
“Although we can be proud of the superannuation system built over the last 30 years, for the sake of women, low income earners and vulnerable Australians, more action needs to be taken to improve its fairness, equity, adequacy, and transparency.”
