Nursing union in voluntary super call

An independent nurses union has called on the government to make super voluntary for low to middle-income workers.

Nurses Professional ­Association of Queensland assistant secretary Jack McGuire.

The independent Queensland nurses union has called on the government to make superannuation voluntary for low to middle-income workers, declaring forced saving was “neither good for savers nor the government budget”.

The Nurses Professional ­Association of Queensland, which represents about 5000 nurses and is growing in popularity, said compulsory super was a benefit almost ­exclusively to “fund managers, ­industry groups and unions”.

The union, which is fiercely ­independent from all political parties, said the compulsory super system was backed by an “unholy alliance of big banks and unions”.

“The main losers from compulsory superannuation are low- and middle-income workers, young families, and people wanting to buy a house, who are forced to save the wrong amount of money in the wrong way at the wrong time,” it said in a submission written by University of Queensland economist John Humphreys.

“For most people, compulsory super is either unnecessary (since they would choose to save anyway) or counter-productive.”

Super has faced a barrage of criticism in recent years for excessive fees, complexity and ineffectiveness, culminating in a Productivity Commission inquiry that called for major reforms — and a government inquiry into the retirement system — ahead of a legislated increase in the compulsory saving rate from 9.5 per cent to 12 per cent by 2025.

The financial services sector, which earned almost $40bn in super fees last year, Labor and trade unions strongly support the policy established by the Keating government in the early 1990s.

The net impact of compulsory super for the government was “a significant deterioration in the budget position”, the submission said, given that the cost of tax concessions significantly outweighed savings in age pension payments.

“For most middle-income earners, investing in superannuation is a bad investment, causing a large drop in working-age income but only a marginal increase in retirement income,” it said. “People who expect to die relatively early will prefer to have higher levels of consumption earlier in life.”

Jack McGuire, the association’s assistant secretary, said rival union the Queensland Nurses and Midwives Association, which supports compulsory super, had a “conflict of interest” because its ­secretary was also on the board of HESTA, an industry super fund.