Raise women’s super to 15pc: Victorian Labor

Business leaders have slammed a Victorian government proposal to increase super to 15 per cent and amend laws for women.

The Andrews government has called for a rise in the superannuation rate for women to 15 per cent. Picture: istock

Business leaders have slammed a Victorian government proposal to increase superannuation from 9.5 to 15 per cent and amend sex discrimination laws to allow ­employers to pay women more super than men.

Employer groups said the move would make women more expensive to employ, while the Victorian public sector union called for Treasurer Tim Pallas to increase super payments for all public servants immediately.

The Victorian submission to a federal review of the retirement income system recommends super be part of the commonwealth’s paid parental leave scheme, that super funds introduce a fee-free period of up to 12 months for people on parental leave, and that couples be ­allowed joint super accounts.

The submission also calls on the Morrison government to ­deliver on its legislated commitment to increase the super guarantee rate to 12 per cent by 2025, as well as providing “a pathway” for the rate to eventually be lifted to 15 per cent. It further calls for super payments to be made payable on payday, as well as for the abolition of the $450 monthly earnings threshold.

Mr Pallas said that had the Abbott government not altered the timeline in 2014, Victorians would have been receiving super at 12 per cent by 2019.

Instead the rate is legislated to increase to 10 per cent next year and 12 per cent by 2025.

Mr Pallas said reform was needed to account for the gender pay gap and increasing levels of insecurity in the labour market.

“We need to fix those problems, and anybody who says ‘Well this is just an impost on business’ needs to be very clear that if these payments are not made within the timeframes that they were committed to by legislation, then we will see increasing pressure on the welfare system as we create a higher level of essentially the retired poor.”

He said the average woman’s super balance at retirement in 2015-16 was $157,050, compared with $270,710 for men — a gap of 42 per cent.

Council of Small Business ­Associations chief executive Peter Strong said the Andrews government’s proposals would make it “more expensive to ­employ a woman”.

“The cost of everything will have to go up to pay for this, and that will affect pensioners, the needy and families … battling with the cost of living,” Mr Strong said. “It’s a stupid idea.”

Victorian Chamber of Commerce and Industry chief executive Paul Guerra said some of the Victorian proposals “may have the effect of reducing job opportunities and wages”.

State opposition Treasury spokeswoman Louise Staley said increasing super to 15 per cent would depress wages “just at the time when a lot of families, a lot of women, have high bills with their kids at school”.

“There is a trade-off here, and the government doesn’t seem to understand that,” Ms Staley said.

The Commonwealth and Public Sector Union called for the Andrews government to ­immediately increase super for its public servants to 12 per cent.

“(It’s) beyond belief that these advocates of increasing super won’t pay an increase to their own workforce, having rejected just recently our claim to lift super to 12 per cent,” the Victorian branch tweeted.