Pay super with wages to help reduce $3.6 billion in lost entitlements
14 March 2017
Cbus, the industry super fund for the construction industry has called on the Federal Government to take steps to align the payment of workers’ superannuation with wages.
Cbus Chair Steve Bracks AC said the submission by Cbus to the Senate Inquiry into unpaid superannuation outlined several important steps to help protect workers’ entitlements.
“The most effective solution to the growing problem of unpaid superannuation is to try and prevent it happening in the first place.
“Paying superannuation at the same time as wages is a key part of the answer.
“The quarterly payment cycle for superannuation can create a significant risk of non-compliance and significantly delay in detection where this occurs.
“The longer time between payments creates increased opportunities for something to go wrong and for payments to be missed.
“We appreciate that superannuation can be complex for employers and for employees; however, given the tools available, we do not believe there is any compelling reason super cannot be paid at the same time as wages.
“The impact of missing superannuation can be dramatic on individuals and the wider community with lost tax revenue and increased reliance on the age pension. We all lose from unpaid super,” Mr Bracks said.
Industry Super Australia (ISA) and Cbus jointly released a report last December year which estimated Australians were missing $3.6 billion in superannuation each year.
Mr Bracks said a recent survey of our members found 14.7% report experiencing a problem with unpaid superannuation and only 60% of members were confident their super had been paid. Unfortunately, more than a third of those people who had experienced unpaid super reported that their issue had not been resolved.
The Senate Economics Committee is holding hearings in Melbourne today (14 March) into unpaid superannuation and will be making recommendations on how to improve the system.
For more information see: Cbus submission to the Senate Standing Committee on Economics Superannuation Guarantee non-payment (PDF)