ASFA calls for gig economy super solutions

With the rise in number of gig workers, the Association of Superannuation Funds of Australia (ASFA) has called for legislative reform to ensure shifts in the economy would not unruly impact retirement planning for many individuals.

According to ASFA’s chief executive, Martin Fahy, the super settings for gig economy should be fixed as soon as possible.

Therefore ASFA’s pre-budget submission focused in particular on: the need for a new ‘dependent contractor’ category within the legislative framework for the superannuation guarantee (SG), tougher sham contracting penalties, SG for the self-employed and an elimination of the $450 threshold for entitlement to the SG.

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Fahy called that ASFA recommendations to be “achievable and fair” and called on the government to support them.

“With the rise of the gig economy, how people work is likely to become more varied,” he said.

“Gig economy platforms continue to show exponential growth so we need to ensure those involved are not losing out on super. The gig economy should be part of the solution for funding retirement rather than a problem.

“In the future there is likely to be more work but fewer permanent, full-time jobs, so these challenges must be met to bring everyone forward in the economy.”




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Top article, Oksana. Right on the money for 4/5 million participants in the freelancing economy in Australia. This represents about 37% of the workforce. It is an issue that Christine Lagarde, The Managing Director of the International Fund is aware of and the subject was covered in The Future of Work Forum. Sara Horowitz, the Ex CEO of the Freelancers Union in the United States spoke on the topic as well, see here https://www.imf.org/external/POS_Meetings/SeminarDetails.aspx?SeminarId=263. The question obviously arises as a consequence of asking about The Future Of Work is what is the Future Of Retirement. Clearly, it cannot be as it has been in the past when there is now a greater longevity risk of future retirees outliving their retirement savings. Freelancers have no awards, no Fair Work Commission, no SGC, no portability of ex employers superannuation insurance etc etc and compete in a global marketplace against countries with lower wage structures. The way that longevity risk is currently assessed must change to include work-life balance management to alter the run-off rate of retirement savings. The issues are covered in this article:https://www.facebook.com/notes/john-cosstick/disruptive-innovation-and-c.... However, now that Christine Lagarde and Sara Horowitz (The current chairperson of The Federal Reserve Bank of New York) can see the issue it is an essential reform whose time has come.

I invite you to subscribe to the Freelancers-Work-Guide.com newsletter that covers a lot of the issues related to freelancing in Australia. Here is the link to the back issues for perusal http://www.freelance-work-guide.com/Freelance_Work_Guide-backissues.html. Freelancers need your support to help bring about this reform. However, I do believe that with Christine Lagarde, Sara Horowitz and Jane Norberg aware of the issue they are going to make it happen.

I look forward to reading more of your articles on this important subject.

Best.

John

Self employed people don't get sick leave or holiday leave or funeral leave or any of that either, but the questions is who will pay for the SG? The person hiring them? The government? Its all well and good to say yes everyone deserves SG< but who's going to pay it. I am self employed, I pay my own SG this is the way it is when you have the freedom of your own business, you take on the costs associated with it.... people need to take more effort in their own financial situations, its not hard to get a super account. Most contributions for self employed/freelancers are tax deductable, there is nothing stopping people from doing this already themselves. The ASFA are too conflicted to give input into this type of discussion, as they are the main benefactors, but this is just as per usual in this industry.

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