Analysis of ATO data reveals Australia’s unpaid super bill blows out to $5.7bn

Huge losses in Aussies’ retirement savings has emboldened calls for ‘payday super’ reforms which would see employers forced to pay their workers super at the same time as salary and wages.

Workers are being urged to check their superannuation balances after the Australian Taxation Office (ATO) revealed the nation’s unpaid super bill had blown out to $5.7 billion a year.

The huge losses in Aussies' retirement savings has emboldened calls for ‘payday super’ reforms – slated for 2026 – which would see employers forced to pay their workers super at the same time as their salary and wages.

Analysis of the newly-released data showed a mammoth $600 million increase in unpaid super payments from 2022 to 2023, meaning Aussies are collectively now out of pocket $110 million a week in retirement savings.

And with the payday super legislation stuck in limbo as superannuation funds and lobby groups lock horns over the timing of its introduction, the Super Members Council (SMC) has cited a survey showing public support for its introduction.

A survey of more than 1000 Aussies, conducted for the group, found more than 70 per cent supported payday super laws coming into effect on July 1 next year, while less than 10 per cent supported delays.

SMC Deputy CEO Georgia Brumby said any delays to the proposed changes would fall on the shoulders of Australian workers.

“The message from Australians to all parliamentarians is loud and clear on passing payday super laws: just get on with it,” she said.

“Each week these laws are delayed, Australians are made $110 million poorer in retirement which means less money to pay the bills after a lifetime of hard work.

“The sooner this legislation is introduced and passed, the more time and certainty it will give

businesses and the super payment system to prepare – so all workers can get paid their super on time and in full.”

SMC Deputy CEO Georgia Brumby said any delays to the proposed changes would fall on the shoulders of Australian workers. Picture: Supplied

The government has fallen under increasing pressure, since the release of its draft legislation earlier this year, from some of the country’s leading accounting bodies to postpone the planned start date.

CPA Australia, CA ANZ and the Tax Institute, while all supporting the plan, have urged the government to delay the 2026 start for “ideally 24 months, but at least 12 months”.

The SMC argues the move to match super contributions to wage and salary payments will help the ATO enforce unpaid super regulations, a task they have historically performed poorly.

In the 2020-21 financial year the taxation office managed to recover just 17 per cent of the $4.7bn in unpaid super, while in the prior seven years it managed just 12 per cent.

“Payday super will not only stamp out unpaid super – it’ll put nearly $8,000 more in the average Australian’s pocket at retirement, thanks to more frequent payments and the power of compounding,” Ms Brumby said.

The SMC has recommended workers, who suspect they are a victim of unpaid super, cross-reference their entitlements with their employer’s contribution.

Originally published as Analysis of ATO data reveals Australia’s unpaid super bill blows out to $5.7bn