The Association of Superannuation Funds of Australia (ASFA) has welcomed the release of the Senate Economics References Committee report on women in retirement, saying it acknowledges issues outside of super, including pay rates and workforce participation.
The “A husband is not a retirement plan – achieving economic security for women in retirement” paper was handed down last week and recommended changes the government could make to improve the super system for women.
Given the large disparity in account balances between men and women at retirement, ASFA has long advocated for changes to the super system that will address the broken work patterns experienced by women throughout their working lives.
In particular, ASFA welcomed recommendations on payment of the superannuation guarantee (SG) on parental leave, abolishing the $450 per month threshold for the SG, maintaining the low-income superannuation contribution, increasing the SG to 12 per cent as soon as possible and amending the Sex Discrimination Act 1984 to allow higher super contributions.
“We urge the federal government to commence implementation of at least some of these measures as part of the 2016/17 budget, along with allowing greater flexibility in the system for those with broken work patterns to catch up,” ASFA chief executive Pauline Vamos said.
“The report acknowledges issues outside of super, including pay rates and workforce participation rates, which we believe are also important in addressing this disparity between women and men in retirement.”
Women retired, on average, with $92,000 less in super savings than men, Vamos said.
“We also know that around 90 per cent of women will retire with inadequate savings to fund a ‘comfortable’ lifestyle in retirement, which is why we are pleased that the committee has made recommendations consistent with ASFA analysis and recommendations,” she said.
“We know that many women work multiple part-time jobs in order to support their families and as a result they miss out on retirement benefits.
“Fixing this is one key lever to addressing the overall gender gap in superannuation.”