The Australian Institute of Superannuation Trustees (AIST) has announced a four-step plan they hope will assist in closing the gender savings gap at retirement for women.
Thanks to a combination of lower wages, underemployment and career breaks to raise children, women frequently retire with almost half the super of their male counterparts. The AIST hopes the new plan will address these issue to improve outcomes for women.
AIST CEO Eva Scheerlinck, said Australian women were currently retiring with 47 per cent less super than men, with an estimated two out of five single women retiring in poverty.
AIST has called for the removal of the monthly threshold that precludes some women from receiving super payments, called for super to be paid on parental leave and better government reporting of the financial gaps between men and women.
“The longer the government waits to address the gender savings gap, the more women will retire with inadequate incomes,” Scheerlinck said.
AIST’s four-step plan to help improve retirement outcomes involves:
- Abolition of the $450 monthly income threshold for compulsory super payments;
- Paying super on paid parental leave – this is the only form of leave that doesn’t attract super;
- Providing low income earners, most of whom are women, with an additional super contribution as outlined by the Women-in-Super advocacy group. Modelling shows this would make the biggest difference to closing the gender retirement gap;
- A firm commitment to move to 12 per cent compulsory super in accordance with the legislated timetable, which is very important to improve retirement outcomes for women.
Scheerlinck said the AIST will be calling for these measures to be part of this year’s Federal Budget.