The Association of Superannuation Funds of Australia (ASFA) has spoken out against the Grattan Institute’s latest superannuation policy paper, saying it was “replete with Victorian era proposals to fix the gender gap in Australian retirement incomes.”
The Institute’s paper proposed rental assistance to age pensioners occupying a low-income demographic. It did not address increases the superannuation guarantee (SG).
Martin Fahy, ASFA chief executive, said that this approach offered a “fatalistic view of the future earnings of women and low paid workers and condemned them from an early age to poverty in retirement.”
He said that the reality was the lifting the SG quickly as the most effective solution to improve women’s retirements, and in refusing to acknowledge that, the paper was “simply Grattan having another go at super.”
The proposals to offer age pensioners on rent assistance additional assistance would not lift women’s long-term prospects of having a decent retirement.
“The age pension and rent assistance alone cannot provide an adequate or acceptable retirement for Australians. The paper misses the reality of retirement living costs in Australia and the aspirations of the community to live comfortably, not just survive, in retirement,” Fahy said.
He said the proposal would only cost the Government around $140 million a year, and so should be considered on its own merits within the Budget rather than as a solution to superannuation inequity.
Fahy also said that the paper reduced wage determination to trade-off between wage increases and super.
“This is an oversimplification,” he said. “In the current wage bargaining environment, it is unlikely that forgone SG increases would translate directly into wage increases.”
He said that rather than focusing on saving Budget money in the short-term, the Institute should instead have focused on intergenerational challenges, such as the gender pay gap and disparities in the allocation of home and family duties.