Former PM Malcolm Turnbull backs the scheduled rise in superannuation payments

Former prime minister Malcolm Turnbull has revealed which side of the fence he is on when it comes to increasing superannuation payments to 12 per cent.

Former prime minister Malcolm Turnbull has revealed he backs the scheduled rise in the superannuation guarantee that will increase the amount of savings for Australians at retirement.

Speaking at an Industry Super Australia (ISA) event on Friday, Mr Turnbull joined other high profile Australians who support the legislated increase in super payments to 12 per cent, arguing it will boost the nation’s long-term savings and productivity.

“Australia’s superannuation system is the envy of the world,” Mr Turnbull said.

“The legislated increase to 12 per cent should be maintained, not just to deliver a more secure retirement for millions of Australians but to build stronger economic growth and higher wages.”

Malcolm Turnbull joined other high profile Australians to support the legislated increase in super payments to 12 per cent. Picture: Bianca De Marchi/ AAP.

Mr Turnbull’s stance goes against a growing group of Liberal backbenchers calling for the rise in super contributions to be scrapped, claiming it would dent wages growth and hinder the nation’s economic recovery from the coronavirus pandemic.

Liberal MPs Tim Wilson and Jason Falinski have also floated the idea of people being able to dip into their super to put towards a home deposit — a policy Mr Turnbull branded as “one of the craziest ideas”.

“The proposition that super contributions should not be increased or should be able to be accessed to put into the housing market is surely one of the craziest ideas I have heard,” he said.

Tim Wilson is one of the vocal Liberal MPs against increasing super to 12 per cent. Picture: Supplied.

His comments coincide with an independent report released by ACIL Allen that shows the economy would grow by an additional $12bn and add 10,000 more jobs if the rise goes ahead.

It has been argued the SG rise would be an additional cost to business and prevent an employer hiring more workers.

The ACIL Allen report found a slight dip in wages growth was expected in the short term if the rise to 12 per cent went ahead.

Mr Turnbull noted it was contradictory for politicians in an SG payment scheme of 15.4 per cent to say working Australians should be kept on a rate of 9.5 per cent.

ISA chair Greg Combet said Australian workers had not had a rise in their SG payments since 2002. Picture: Jono Searle/ AAP

“If we cut to the chase here, politicians and public servants have a compulsory 15.4 per cent super contribution,” he said.

“Isn’t it … somewhat patronising for people who benefit from 15.4 per cent super to say that working people should settle for 9.5 (per cent).”

ISA chair Greg Combet said Australian workers had not had a rise in their SG payments since 2002.

He also said the long-term benefits from an increase in super payments would offset any short-term impact to wages.

“The consequences of cutting super are crystal clear – it leads to permanently slashed wages, jobs lost, and the economy crimped all while adding to the aged pension and leaving Australians far worse off in retirement,” Mr Combet said.

Former prime minister Paul Keating is a staunch defender of the SG rise, recently lashing out at the Coalition’s “baby faced Liberals” who were set on trying to destroy the nation’s retirement system.