Research firm Rice Warner recommends the Government amend the Sex Discrimination Act to make it easier for employers to pay more superannuation to female employees, in their 2015/16 pre-budget submission.
Rice Warner says they introduced in July 2013 a “package of benefits for its female employees,” designed to improve their retirement savings.
This package included paying superannuation guarantee below the $450 monthly threshold and an additional 2% superannuation contribution.
Rice Warner sought advice from the Human Rights Commission if the additional 2% super contribution would breach the Sex Discrimination Act.
“The Human Rights Commission was supportive and considers our initiative to be a Special Measure because it seeks to address an existing inequality between genders,” said Rice Warner.
To make it easier for other employers to pay such additional superannuation contributions to female employees Rice Warner recommends the Government make amendments to the Sex Discrimination Act.
House of Reps Greens member Adam Bandt has introduced the Sex Discrimination Amendment (Boosting Superannuation for Women) Bill 2014 to the Parliament, though it is unclear if it will receive Government support.
The 2015/16 pre-budget submission also reiterated the previous recommendation of Rice Warner to introduce joint superannuation accounts, which has receive “positive feedback from the superannuation industry.”
“If this initiative were introduced, it would improve efficiency in the system, be beneficial for millions of members and have no cost to government,” said the budget submission.
The simplified structure for couples, combined with Member Direct investments now offered by several funds, would provide many of the benefits of a self-managed superannuation fund (SMSF). This might appeal to those members who want the flexibility but not the responsibility of running an SMSF.
An SMSF would have a simpler process too. Where both partners of a couple are the only members, the accounts would be much simplified as they wouldn’t need separate annual statements.
Rice Warner also recommends that the $450 monthly minimum threshold for superannuation guarantee be removed. Though initially introduced so employers did not face high costs of paying small amounts of superannuation, Rice Warner considers “that this threshold is no longer needed as the majority of contributions are being lodged electronically.”
These recommendations “deliberately focuses on matters which will have minimal impact on the Federal Budget, but which will improve the efficiency of the superannuation system.”
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