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Employers will ignore SG delay
Many employers may well move towards implementing the proposed superannuation guarantee (SG) increases sooner "of their own volition", head of an advisory group said.
Frontier Advisor CEO Damian Moloney believes many of the more progressive employers will move towards the original target of 12 per cent by 2019/20.
"Many employees already receive super contributions above 9.25 per cent so this delay just further penalises those workers who can least afford to be left behind," Moloney said.
Moloney also argued people will lose confidence in a super system that is continually changing, especially when the changes are "politically driven".
"Workers, not to mention employers and even super funds themselves, want to feel like there is a plan in place that will remain protected from political tinkering," he said.
"I think we had that when the SG rose from 3 per cent to 9 per cent over a decade. The fact it will now take 23 years, which is around half many people's working life, from the time we reached 9 per cent to get to 12 per cent is too long and is a missed opportunity for the economy and for individuals. "
The delay of reaching the 12 per cent contribution level until 2025 will mean it will be 2075 before the first group of workers across the board retire with 50 years of that level of super contributions to support them, he said.
"Who knows what the landscape will look like then."
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