Super system magnifies gender inequality
The generosity of the tax expenditures on superannuation, and the limited controls on contributions, greatly magnify the negative effects of a superannuation system on gender inequality, according to the Curtin University based, Women in Social and Economic Research group (WISER).
The group has used a submission to the Senate Inquiry into the Economic Security of Women in Retirement to argue that the superannuation system, as it currently stands, is skewed towards men and those who are well off.
"The groups most able to benefit from the tax expenditures on superannuation are high income earners and those with flexible assets that can be moved into the tax-advantaged superannuation system," the submission said.
"Because women are underrepresented in these groups, they receive a relatively small share of the benefits of the increasingly large tax expenditures on superannuation."
The WISER submission said that its overall evaluation of Australian policy on retirement savings and income on the criteria of gender equity was "negative".
"The shift in focus toward superannuation, and especially the large tax expenditures on superannuation, has exacerbated rather than reduced gender inequality," it claimed adding that, "generally, the policy settings are also contributing to higher levels of inequality in the incomes of older Australians".
"Under the current policy settings some retirees, and statistically more men than women, who have accumulated significant assets in superannuation will access large tax-free incomes in retirement and derive the benefits for health and care that this provides," the submission said.
"Others, and more commonly women than men, will continue to depend on the age pension, which will deliver them an increasingly frugal existence."
The submission said that, fundamentally there was a need to balance the resourcing of superannuation tax concessions and the age pension.
"This will require a substantial winding back of the tax concessions available for superannuation," it said.
Recommended for you
Melbourne advice firm Hewison Private Wealth has marked four decades of service after making its start in 1985 as a “truly independent advice business” in a largely product-led market.
HLB Mann Judd Perth has announced its acquisition of a WA business advisory firm, growing its presence in the region, along with 10 appointments across the firm’s national network.
Unregistered managed investment scheme operator Chris Marco has been sentenced after being found guilty of 43 fraud charges, receiving the highest sentence imposed by an Australian court regarding an ASIC criminal investigation.
ASIC has cancelled the AFSL of Sydney-based Arrumar Private after it failed to comply with the conditions of its licence.
