Super changes will hurt working women
Plans to axe the rebate for low-income workers will affect the financial security of half of all working women and disproportionally hurt rural workers, according to a recent warning from industry superannuation funds.
The Coalition has plans to scrap the $500 Low income Super Contribution for people earning less than $37,000 a year as part of the bill to abolish the mining tax.
According to Industry Super Australia (ISA) the move would cut as much as $27,000 from the retirement savings of 3.5million Australians most of which come from already savings - disadvantaged groups of workers - women, rural and young workers.
The Minerals resource rent Tax (MRRT) repeal bill would also delay increases to compulsory super contributions made by employers, by two years.
It's estimated that these two measures would slash $53 billion from the nations superannuation savings by 2022.
Instead, the funds are proposing a scale back of the Coalitions paid parental leave scheme in order to maintain the rebate and propose a tax offset for all workers making extra contributions to super.ISA chief executive David Whiteley told the ABC that the changes were unfair and unsustainable and would leave Australia's most vulnerable low-income workers without a tax concession on their superannuation, while those on high incomes and most able to afford a comfortable retirement still receive concessions.
"We would be very keen to see that every option is exhausted to make sure that all Australians are getting access to tax concessions on their super," Mr Whiteley told the ABC.
Axing the rebate will undermine efforts to improve women's retirement savings and affect the income of around 2 million working women, including 80 per cent of part time workers.
It's estimated that the financial disadvantage women will have in retirement will be as high as $1 million in the course of a lifetime. Women earn an average 17 per cent less than men and are further disadvantaged by career gaps when they take time out of the workforce to have children, with men possessing 63 per cent of the nations $1 Trillion in super.
The coalition raised cutting the contribution and delaying the increase in Super guarantee during the federal election and confirmed the move earlier this month. The opposition has described the move as "warped" and has vowed to fight in Parliament.
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