COTA NSW is calling on the Government to change Australia’s superannuation scheme following new research that highlights how current policies disadvantage women at their most vulnerable stage in life.
The peak body will today release a new report ‘The super bias: an insecure future,’ which draws on responses from more than 7600 people across New South Wales to a survey about their experiences of post-retirement income, housing security, work and retirement.
Meagan Lawson, CEO of COTA NSW says the results highlight a systemic problem requiring broad changes across workplace practices and tax, post retirement income and housing policy in order for women to get a fairer deal.
“Every woman should earn superannuation on every dollar they earn, but they don’t,” Ms Lawson said.
“Our survey found that women continue to earn less than men over their lifetimes, with the gender pay gap at its largest just before retirement. We found that on average a 60-64yo woman is earning 76.3c for every dollar her male colleague is earning.”
“Australia’s current superannuation scheme was designed on the principle of stable full-time employment. However, this doesn’t reflect the reality for most women.”
“They are overrepresented in part-time and casual work, often holding down multiple jobs at once, and are usually the one to have time out of the workforce for maternity leave and caring for family later in life,” Ms Lawson said.
The report also highlights concerns for younger women who earn less than $450 a month from one employer, as employers are not required to pay 9.5% superannuation on incomes below this rate.
“The current law discriminates against many women’s superannuation earning potential. We see many industries moving to a more casualised workforce and this will only make the problem worse,” Ms Lawson said.
“In the age of no longer “cutting a cheque”, all political parties need to recognise that the $450 threshold is no longer defensible.”
The report found that the average amount of accumulated superannuation at retirement was $292,510 for men, and only $138,154 for women. This sharp difference grows after retirement age as people begin to draw on their superannuation.
The peak body says drastic changes are needed to reflect the realities many women face including increases to Commonwealth rent assistance payments by 30 per cent, removing the the $450 monthly pay threshold for Superannuation Guarantee and paying superannuation on government benefits up to the time people draw the Age Pension.
Other recommendations include:
• Allowing women to contribute $1000 more per year
• Establishing and resourcing an integrated retirement income policy framework
• Implementing the planned increase in the Superannuation Contribution Guarantee rate to 12%
“The stories that women in NSW have shared show just how quickly and easily a woman’s economic security can be derailed by unpredictable life events, at any time: relationship breakdowns, caring responsibilities, serious illness,” Ms Lawson aid.
“Action is needed now to level the playing field for older women and try and stem the rising tide of women left behind by an income retirement system that reinforces gender inequality and fails to address the entrenched disadvantage that women face at what is often the most vulnerable time of their lives.”
“Probably one of the respondents to our survey said it best: “I have found it very difficult to find rent I could afford and now my rent is draining my meagre savings. I am afraid that I may have to become a homeless person, and I don’t think I will survive out there.”