5 reasons why women have less super than men

And how to even the scales

If you’ve heard about the gender pay gap, chances are you’ve also heard there’s a superannuation gap between men and women.

But with a staggering superannuation gap of 47 per cent, many are left asking ‘why’?

Here are five reasons for the current super gap – and our thoughts on how to even the scales, and achieve a better retirement outcome for all low income earners, but especially women.

Included are measures from Women in Super’s (WIS) five point plan. The measures, outlined as part of our Make Super Fair campaign, are designed to improve economic security for women in retirement and make the system fairer, more efficient and sustainable.

  1. Gender Pay Gap

Australia’s gender pay gap has sat at between 15 per cent and 19 per cent for the past 20 years, and is a major contributor to the significant superannuation gap between men and women.

Solutions: Policy measures to address the gender pay gap will go a long way to bridging the super gap. Such measures might include legislated pay parity, introducing more flexible working arrangements, extending paid parental leave, and better pay in sectors that attract more women, such as the childcare sector.

We are also advocating for an increase to employer super contributions from 9.5 per cent to 12 per cent without delay.

  1. Workforce Participation

More women are participating in the workforce and, encouragingly, the gap in participation rates between men and women has lessened from 17.8% in 2001-02 to 11.1% in 2016. However, more women than men continue to seek part time and casual work, adversely impacting their super-balances.

We also know that an estimated 220,000 women miss out on $125 million in superannuation contributions because they do not meet the $450 per month before tax super threshold.

Solutions: We are calling on the Government to remove the $450 monthly income threshold on superannuation contributions to help bridge the super gap and ensure that women in part-time and casual roles – or women who have multiple jobs - aren’t unduly penalised.

More flexible working arrangements, such as the option to work from home, childcare facilities at work, greater flexibility around work start and finish times, and job sharing options, would also encourage greater workplace participation.

  1. Motherhood and Caring Responsibilities

Women in Australia continue to take on the bulk of caring responsibilities for children, elderly relatives and other family members, such as people living with a disability. While stay-at-home dads account for just 4 per cent of fathers, 31 per cent of mothers stay at home. It is also well documented that women face substantial pay penalties upon their return to the workforce after a period of maternity leave. Conversely, some studies suggest men experience a ‘fatherhood premium’ after paternity leave, and are likely to earn more than their childless colleagues.

Solutions: Once again, more flexible working arrangements must be part of the solution, while attitudinal shifts towards working mothers and fathers, as well as traditionally ‘female’ caring roles are also key. Better childcare subsidies are essential too.

  1. Super Inequalities

Women are further penalised during maternity leave because no superannuation payments are made whilst on parental leave. This is unlike all of the other types of leave, where employers are still required to pay super.

Solutions: Superannuation payments must become part of the Government’s Paid Parental Leave scheme to help combat the super gap.

  1. Taxation Policy

The taxation system for superannuation also favours those who earn more. Currently, the Government spends $30 billion annually on super tax concessions that mostly favour high income earners. Women receive only one third of Government tax concessions on super, with the bottom 30 per cent of income earners (most of whom are women), getting nothing. Meanwhile, the top 20 per cent of income earners get $10,000 every year.

Solutions: We propose that low-income earners aged 25 and over receive a $1,000 per annum Government contribution into their superannuation until they reach a super balance of $100,000 in order to address inadequate retirement savings. The estimated cost of this scheme is $2.7 billion per year, and would increase low-income earners’ super balance by almost 15 per cent. This could be the difference between living comfortably in retirement or not.

At the same time, the Government could consider removing tax concessions for the top 20 per cent, in a bid to instead prioritise these funds for those who need them most.

Make Super Fair is also calling on the Government to undertake a gender impact statement before making changes to age pension or retirement income policy, so that policies can start to create a fairer super system for all.


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