While the economy is weak, jobs should be the priority, according to Chartered Accountants ANZ (CA ANZ) superannuation leader Tony Negline.

“Since the last election, there has been a global pandemic, the first Australian recession in 29 years, our highest unemployment in 20 years, record stagnancy in wage growth, and the world falling apart at the seams," he said.

"The reason we paused our policy is jobs. Super is a percentage of a salary, and you need a job to get a salary. The priority right now should be keeping people who have them in jobs, and helping the unemployed get new ones."

While the unemployment rate has recovered to 6.6%, most of the recovery has been in part-time work, up 0.6% on March 2020 levels.

Full-time employment lags behind, still down by 1.3% on March 2020 figures, and hours worked is subdued, down 1.4%. 

Last week, figures showed the final early super withdrawal tally totalled $36.4 billion, for an average withdrawal of $7,402 in initial applications, and $8,268 in repeat applications.

Federal Opposition leaders have been vocally critical about the Government's halt in raising the superannuation guarantee.

"Scott Morrison ... promised to raise superannuation contributions to 12% at the last election but broke his word and is now planning to repeal his own legislation," Shadow Assistant Treasurer Stephen Jones said.

"Remov[ing] wage protections for workers will only see wages go further backwards and retirement savings further starved of contributions."

The main argument against raising super is that it could come at the expense of wage growth; however, the counterargument to this is that wage growth is stagnant and even going backwards anyway, so extra enforced savings could be necessary.

Mr Negline also expressed concerns about the early super withdrawal scheme being used to fund surgeries, and home deposits. 

“Our super system needs protection. Some are putting it to the sword, and it needs a shield. But what we can’t do is make it more generous right now," he said.

“We need to be making it easier, not harder, to boost the economy for businesses to invest and for jobs to be created.

"Let’s park the super increase priority to when the vaccine is rolled out, and when the employment and GDP numbers look a little less like a horror show.”

While Australia is out of a technical recession, its September quarter growth figure lagged behind other developed nations - Australia's 3.3% GDP rebound ranked 52nd out of 63 OECD nations.

Photo by Alex Kotliarskyi on Unsplash

Ready, Set, Buy!

Learn everything you need to know about buying property – from choosing the right property and home loan, to the purchasing process, tips to save money and more!

With bonus Q&A sheet and Crossword!

By subscribing you agree to our privacy policy