A sweeping overhaul of superannuation policy has been proposed to overcome the enormous disadvantages for women when they retire as the Australian government considers changes aimed at promoting fairness.
Industry Super Australia says its plan would help close the gender pay gap in super savings, which stands at 44%, potentially improving the retirement income of a schoolgirl preparing to enter the workforce now by 35% – or more than $75,000 a year.
It aims to overcome the multiple obstacles to women accumulating enough super savings to live comfortably in their old age, such as lower overall pay, maternity leave, periods of part-time work and caring leave, which mean 38.7% of single women now live in poverty in retirement – a situation likely to become worse owing to declining rates of home ownership and recent superannuation policy changes.
The Labor senator Jenny McAllister, who sits on the inquiry, says it is often assumed that women’s retirement incomes will improve as more women work and the super system matures but the Industry Super research says this is not true.
“The super gap is a direct product of the differential between lifetime earnings of men and women and Industry Super shows that more than half of women currently aged 25‐29 years, retiring in 2055, will not achieve a comfortable level of retirement income,” she said.
Industry Super Australia’s deputy chief executive, Robbie Campo, says the argument about the impact of the current super system on women has to be central to the debate about the taxation of superannuation.
“The current settings are weighted against the typical pattern of work and unpaid work by women,” she said. “Changing them could give women a fairer share and more adequate retirement incomes.”
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