Back in May, the architect of Australia’s compulsory superannuation system, Paul Keating, urged the federal government to raise Australia’s superannuation guarantee (i.e. compulsory superannuation contributions) from 9.5% to 12%, claiming it would compensate workers for productivity gains during a period of low wages growth.
At the time, I noted that Keating’s argument was non-sensical, given raising the superannuation guarantee would lower worker’s take home pay, given the cost of compulsory superannuation contributions unambiguously falls on the employee, not on the employer – as noted explicitly by the Henry Tax Review. It would also cost the Federal Budget another $2 billion a year, while heightening inequities already rife in the superannuation system.
