A new report released today by Industry Super Australia (ISA) into unpaid super has found millions of Australians are missing out on their entitlements every year, confirming the need to get to the bottom of how and why this is occurring through Labor’s newly-established Senate inquiry.
Under the Superannuation Guarantee (SG) employers are legally required to contribute 9.5 per cent of wages into the account of every worker over the age of 18 earning $450 per month.
But the ISA report found about one in three SG employees are missing out on some or all of their super because their bosses aren’t doing the right thing.
It also found that workers aged under 30 were most likely to miss out, with 37 per cent of 20-24 year-olds losing SG payments from their employer, compared with 23 per cent of 50-54 year olds.
The report estimates that a staggering $3.6 billion per annum is not being paid by employers, with workers missing out on an average of $1,489 – the equivalent of four months of superannuation contributions.
If this was allowed to continue lost super earnings could reach $66 billion by 2024. This would not only put significant further demand on the age pension, but it would also deny hard working Australians the superannuation payments they are legally entitled to.
That is why last week Labor initiated a Senate inquiry to investigate the extent of unpaid super across Australia and what needs to be done to ensure compliance with the Superannuation Guarantee requirements. Today’s report from ISA will provide important information to support this work.
The Senate inquiry into unpaid super will focus on:
• investigating how much superannuation is being withheld in Australia;
• whether the existing frameworks are adequate to enforce the Superannuation Guarantee; and
• whether the Australian Tax Office has the appropriate level of resourcing to enforce the Superannuation Guarantee.
Labor are the architects of Australia's modern superannuation system and we will always work to protect it so that every Australian can live a dignified retirement supported by all the superannuation savings they are entitled to.
While the Turnbull Government is ideologically obsessed with stripping back the rights of working people, Labor will always stand up and ensure that employees legal entitlements are paid and paid in full.
The inquiry into unpaid super is scheduled to report in mid-March 2017.
MONDAY, 5 DECEMBER 2016
Senator Katy Gallagher is Labor's Shadow Minister for Small Business and Financial Services