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Working families to lose if MPs win on plan to cut super

September 13th, 2019

Australian families will stand to lose nearly $250,000 in retirement savings if the push to cut the super increase by a group of backbench MPs is successful, new analysis reveals.

Some Federal backbenchers want the Government to cut the promised increased in super contributions, breaking a key election promise and denying local families the retirement savings they are entitled to.

New analysisfrom Industry Super Australia (ISA)shows that if the super guarantee was frozen at its current rate of 9.5 per cent, a 30-year-old male earning $85,000 a year would stand to lose $147,0001 from their super by the time they retire.

Separately, a 30-year-old woman earning $85,000 a year, who takes time out of the workforce to have children, could lose up to $93,000 from her super nest egg if the super contribution rate doesn’t increase.

For a local family, by the time they reach retirement, they could lose $240,000 in retirement savings.

This could have a real impact on the quality of life local parents will have in retirement.

It could be the difference between being able to use the heater during winter or taking the grandkids on a holiday – or it could mean that people need to worker longer before they can retire to make up the shortfall.

Families should be concerned about their local MPs’ plans to try and take away the extra retirement savings they have been promised.

Independent research commissioned by ISA shows the overwhelming majority of Australians – close to 90 per cent – support an increase in super contributions above its current rate.

The increase in super contributions to 12 per cent has been legislated and promised by the Morrison Government, and to try and take that away without a mandate would break an election promise, and go against community sentiment on this issue.

Comments attributable to Industry Super Australia Chief Executive Bernie Dean

“Australians should ask their local MP whether they stand by their promise to increase super contributions, or if they are happy to break their promise and deny families the extra money they are entitled to.”

“Cutting the super increase will cost families around the country hundreds of thousands of dollars in retirement savings. Australians will be left struggling to make ends meet in retirement, or will be forced to work until they drop before they can retire.”

“If the Government breaks its promise on super everyone loses. The Morrison Government needs to reassure Australians that their retirement savings aren’t at risk.”

This media release is brought to you by Industry Super Australia. For more information, please visit industrysuper.com.

Media contact: Georgia Brumby 0428 698 185 | gbrumby@industrysuper.com

1 All predicted figures are in real terms, meaning that they are deflated back to this year’s values using the CPI.