Super pathway to 15pc guarantee set in stone

A ‘pathway to increasing’ the superannuation guarantee to 15 per cent will present a sharper difference between Labor and the Coalition.

Productivity Commission head Michael Brennan. Picture: James Croucher

A “pathway to increasing” the superannuation guarantee to 15 per cent, enshrined within the ALP’s new draft platform, will present a sharper difference between Labor and the Coalition at the next election than at the 2019 poll when Bill Shorten was opposition leader.

Scott Morrison is weighing up whether to pause the scheduled increase to the super guarantee, due to rise to 12 per cent by mid-2025, in order to avoid slowing wages growth or make it harder for jobseekers to find work as the nation recovers from the coronavirus ­recession.

Any decision to freeze the increase would ignite a bitter political conflict with Anthony Albanese, who has attacked the government over its management of superannuation, including its early access scheme, with the Opposition Leader warning that it will erode retirement savings and accusing the Prime Minister of treating it as a “plaything”.

A new draft of the ALP platform, obtained by The Australian, has reaffirmed the party’s commitment to increase the super guarantee to 12 per cent and also says Labor would set out plan to “set out a pathway to increasing it to 15 per cent.”

The document says Labor will ensure a “progressive and fair tax treatment of superannuation” and if in government, will legislate to ensure the super guarantee becomes part of the national minimum employment standards.

Productivity Commission head Michael Brennan and Reserve Bank governor Philip Lowe have both sounded the alarm on the economic consequences of continuing with the scheduled increase to the super guarantee.

Dr Lowe said last month if the guarantee was lifted from its current rate of 9.5 per cent, he would “expect wage growth to be even lower than it otherwise would be”.

Mr Brennan told a parliamentary committee this month that it was “logical” that raising the super guarantee rate would be an “increase in the net cost to ­business”.

The draft Labor platform also sets a goal for parents to have “access to 26 weeks’ paid parental leave … and a goal of 26 weeks at full pay plus super through a combination of government and employer contributions”.