What the new parliament means for workers’ retirement savings

Labor’s Anthony Albanese has been sworn-in as Australia’s new Prime Minister. The change in government and wave of new independents will provide opportunities to pursue positive changes that boost workers’ retirement savings, but work will be needed to re-build the bipartisan commitment to fundamental strengths of the system.

More workers will have the savings they need for a dignified retirement as the much-needed increases in the Super Guarantee rate are all but assured to continue as legislated, reaching 12 per cent by 2025. 

The community showed how much it values super by rejecting the Coalitions proposal to divert retirement savings into the housing market, potentially inflating already soaring house prices in all states by tens of thousands.

Super was never designed for this purpose and the scheme would have meant lower investment returns for all members.

Meanwhile, in the Senate, it appears Labor will need the support of 13 other Senators to progress its legislative policy agenda, unless there is bipartisan support. The Greens have an extra Senator, taking them to 12, and the Jacqui Lambie network has won another Senate spot in Tasmania, taking them to two. A new independent Senator, David Pocock, will likely win in the ACT.

On the whole, the track record and policy platforms of the cross bench and Greens – including support for the compulsory super and the SG increases – suggest the new Senate will be more favourable on superannuation policy than the last.  

We will be monitoring the incoming Government to ensure it delivers on its election commitments on super, including:  

1.       Maintaining the legislated SG increase to 12%

2.       Taking action on unpaid super by including super in the National Employment Standards and imposing additional reporting requirements on the ATO

3.       Reviewing performance test benchmarks

4.       Legislating a purpose of super

ISA will be advocating for a positive plan for super by work with the new Parliament to strengthen the system and enhance members outcomes. Including by:

1.       Mandating the payment of super on payday

2.       Paying super on Commonwealth parental leave

3.       Improving the universality of the system

Read about ISA’s policy priorities here.