Women could be set to receive a huge boost to their superannuation, as Bill Shorten has today vowed to inject $400 million into a scheme to narrow the gap between retirement savings for men and women if he is elected into power at the next general election.
The Labor leader shared a video on social media on Wednesday morning in which he pledged to address the unbalance between superannuation for men and women, saying the current system is not fair to women.
According to the latest figures from the Association of Superannuation Funds of Australia (AFSA), women had almost half the amount of superannuation as their male counterparts, between the ages of 55 and 59, as they approached retirement, with women racking up just $123,642 in super savings while men had put away $237,022.
These figures both fell far short of the $545,000 that the AFSA say is needed for a “comfortable retirement” – particularly for women – who the industry body described as being “especially vulnerable to experiencing homelessness”.
“Labor’s proud of our superannuation system,” Shorten says in the footage. “But it’s not working as fairly as it should for women, as it is for men, and we’re going to change that today.”
Shorten’s scheme would deliver a top-up payment for those on parental leave, which is one of the main factors that causes women to fall behind men when it comes to super. It is estimated that, if implemented in July 2020, it would affect around 167,000 recipients of the Commonwealth paid parental leave scheme and another 80,000 who are on the Dad and Partner payments scheme.
The policy – which would form part of Labor’s wider Women’s Economic Strategy – would also get rid of a rule that means people earning less than $450 a month do not get any super guarantee levy, while making it easier for employers to make extra payments into women’s superannuation funds.
Deputy leader Tanya Plibersek, Shadow Treasurer Chris Bowen and Shadow Minister for Finance Clare O’Neil also appeared in the 50-second clip. Plibersek follows Shorten, saying: “The gender pay gap and taking time out of work to have kids means that women will retire with about 40 per cent less super than men. These are important steps to begin to reduce inequality in our superannuation system.”
Shorten adds: “Labor wants a fair go for Australian women, so they can secure their own financial future.”
The announcement was welcomed by many, including Industry Super who described the current system as “unforgiving” towards women.
“Once women return to the workforce, catching up on super contributions and lost compound earnings is very difficult,” said Sarah Saunders, from Industry Super. “Adding super to paid parental leave, and phasing out the $450 monthly threshold are changes that respond to both existing realities and the evolving workforce”.
The gender pay gap is a significant issue to be solved.
— dalehurley (@dalehurley) September 18, 2018
Many voters also commended Shorten for the policy on Twitter, with one writing: “Couldn’t agree more we do need a fair go. However what about carers? Often women who give up everything to care. My future is one of poverty because as a carer I get no super. I can’t stop being a carer as my husband will need care the rest of his life.”
Another said: “That’s because women have always been paid less.”
Shorten didn’t miss the opportunity to take a swipe at the Coalition either, with Shorten describing the Liberal party as having “a pathetic record on superannuation”, having “voted against the introduction of universal, compulsory superannuation, and subsequently voted against all of the increases to the superannuation guarantee”.
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