Salaried workers missing out on “alarming” amounts of super

11 April 2019

Almost one million working Australians aren’t receiving superannuation and the often-cited cause of self-employment isn’t the only driver, with new research showing that 43 per cent of these workers were in salaried jobs.

Breaking down the careers of those without super more, Mercer’s Unsupered report found that a surprising 21 per cent were managers, while 15 per cent were technicians and trade workers and 13 per cent were in clerical and administrative roles.

Mercer’s David Knox told Money Management’s sister publication, Super Review, that potential causes for salaried workers not receiving super included them not wanting to ask their employers, small businesses without enough cash flow withholding payments, or the quarterly payment system meaning employees didn’t realise they hadn’t been paid.

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Knox recommended a three-pronged response to the problem, which would have an immense impact on Australia’s retirement savings and the strain the Aged Pension was under in the future, with the Government, regulators, and superannuation funds all having a role to play.

He believed that the Australian Taxation Office (ATO) was the logical regulator to act on the problem, saying that it was playing an increased role in the super space and would continue to do so.

ATO Deputy Commissioner, superannuation and employer obligations, James O’Halloran, told Super Review that the Office was already working in this space, pointing to the expansion of single-touch payroll and payday reporting as one example. Many in the industry had expressed hope that this development could lead to the same system soon applying to super payments.

O’Halloran also said that the ATO was cracking down on enforcement of employers failing to meet their superannuation guarantee obligations, and had been ATO given increased enforcement powers in the last sitting of Parliament too.

Knox further believed that super funds themselves needed to take a more active role in monitoring members’ payments. Funds could instead track members’ payments (which was relatively cheap now thanks to technology) and then contact those who weren’t receiving their super.

The total amount of missing superannuation represented a $4 billion hole in super savings annually, which could add up to $145 billion across the working lives of those missing out. On an individual level, one-third of the ‘unsupered’ workers had no superannuation savings at all, while 49 per cent had less than $6,000.

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