Economic security for women in retirement is under scrutiny by a Senate Inquiry and yesterday’s submission from Industry Super Australia (ISA) highlights just how dire the situation is.
Modelling conducted for ISA by actuaries Rice Warner has revealed that 63 per cent of single Australian women will not be able to retire comfortably, even by 2055. Women continue to retire with just half the payout that men do in superannuation savings, with a gap of 47 per cent for the 2013–14 financial year. ISA notes that other contributing factors include a 19 per cent gender pay gap and the fact women often have a disrupted work history.
Chief Executive David Whitely comments, “Without substantial structural reform in a number of areas, our retirement income system will continue to fail future generations of women. In a relatively wealthy country such as Australia, this is unacceptable.”
Mr. Whitely congratulated the Turnbull government on its ‘preparedness’ to consider rebalancing super tax concessions, stating that, “This would be a significant step in increasing the super savings of millions of Australian women”.
ISA also called upon the government to review the most recent changes to the Age Pension asset test, the abolition of the Low Income Super Contribution (which mainly benefits women) as well as the freeze in the increase of the super guarantee contribution (SGC).
Read more from Industry Super Australia
Women + retirement = poverty. This shouldn’t be the case, but lifelong disadvantage means older Australian women are doomed to live longer, on less, for the foreseeable future.
It’s hardly rocket science to understand why women retire with savings, on average, approximating half those of men. It is scandalous, inequitable and not that difficult to change, but it seems we are all too accepting of this situation and while this is the case, there is little political will to change it. So Industry Super Australia is to be applauded for its stance on the late-life poverty facing many Australian women. With around 6 million Australians holding superannuation in an industry super account, and many of these lower paid workers in hospitality, service and retail industries, ISA is all too familiar with the lot of working women.
Australian working women are generally lower paid. They have fragmented work histories because of their caring duties for others (children, parents and relatives) and the overly generous super tax concession for wealthier workers do not benefit them in any way. In fact, as highlighted by ISA, the abolition of the Low Income Super Contribution is yet another blow to women on low wages.
In a sense, women are punished for their good will and good work. They still perform the lion’s share of housework and family caregiving and at the end of their lives are slammed by a totally inequitable retirement income system.
Our current super tax concessions are simply unfair and punish those who give the most. They should be first on the chopping block for the new regime in Canberra. And yes, a reversal of the abolition of the Low Income Super Contribution should be next.
Read more about this in YourLifeChoices most recent retirement update.
What do you think? Are women treated unfairly when it comes to superannuation? What is your story? What do you believe should change to redress this inequity?