A growing number of Liberal MPs are publicly calling for promised increases to super to be abandoned, while continuing to pocket 15.4% super in their own taxpayer-funded salaries.
Treasurer Josh Frydenberg said the decision to increase the super rate would be revisited before the next federal budget in May next year, but claimed most Australians would be “better off” if super was not increased.
The government’s public reticence to support super rises comes despite a promise ahead of the 2019 election to stand by legislated increases to 12% super in 2025.
The Morrison government seems increasingly likely to freeze or abandon next year’s increase where the base level rate will rise from 9.5% to 10%.
Fractures in the government have widened to the point that Senator Jane Hume, the minister responsible for superannuation, has declared herself “ambivalent” about future super increases.
The call has been supported by fellow Liberal MPs Andrew Bragg, Jason Falinski and Dave Sharma.
However, the government’s own review into retirement income found the withdrawal of $10,000 for a worker in their 30s compounds to a loss of $100,000 upon retirement.
Industry Super Australia chief executive Bernie Dean criticised the proposal to expand the use of super to pay for housing, saying it would “just drive up prices and push ownership further away”.
Mr Dean also criticised findings from the government’s review which proposed, instead of increasing the super rate, retirees should sell the family home to fund their retirement.
Much of the government’s public criticism has conflated super with the issues of low wages growth and poor housing affordability.
IEU-QNT Assistant Secretary/Treasurer Paul Giles said these serious issues must be dealt with separately and not weaponised to deny workers their super.
“The key finding of the government’s own review into retirement income is that our system is broadly effective and sustainable,” Mr Giles said.
Mr Giles said the system’s effectiveness is founded on two principles: that it is compulsory and that money invested in super is preserved.
“The success of our super system is achieved by putting enough funds into it and ensuring that money stays in there until retirement,” Mr Giles said.
“Proposals to withdraw super early and to cut away at the amount of money workers are able to invest completely undermine the success of super.
“No system is perfect but there is simply no reason to deny workers their promised enhancements to super.”
Mr Giles said past freezes to super had not delivered significant wage increases and without the promised 12% super many Australians would be left without sufficient funds for a dignified retirement.
“It’s time to abandon ideological attacks on super; our super system is the envy of many and we must protect it.
“We cannot allow MPs who happily accept 15.4% super to deny Australian workers their hard-earned 12% super and comfortable retirement,” Mr Giles said.
Add your voice to the now 20,000 workers calling on the government to abandon its attack on super by signing the Australian Unions petition.