on air now

‘No plans’ to dump 12 per cent superannuation guarantee despite backbencher push

Pressure is building within the federal government to delay a planned increase to the superannuation guarantee due to the economic impact of coronavirus, but the Assistant Minister for Superannuation insists the increase will not be shelved.

The Age reports 10 Coalition backbenchers are pushing to delay the plan to lift the superannuation rate from 9.5 per cent to 12 per cent over five years, due to the effects of the pandemic downturn.

They say small businesses will not be able to afford the legislated superannuation increase, which is set to begin with a  0.5 per cent rise next July.

Federal Assistant Minster for Superannuation, Senator Jane Hume, acknowledged there is opposition to the increase, but insists it will go ahead.

“We understand that groups like the Grattan Institute and even the RBA … have all agreed that a rise in the superannuation guarantee will have a potentially detrimental effect on wages and employment,” she told Tom Elliott.

“It might take the form of lower wages or fewer pay rises, it might take the form of fewer jobs or a reduction in profits, or potentially it could be passed on to consumers through increases in prices, none of which are desirable.”

But Senator Hume said there’s no plan to dump the legislated superannuation rise.

“Legislation, by its nature, is very difficult to wind back,” she said.

“They have already been delayed once.

“There are no current plans to change that legislated increase, but we understand that there’s going to be some very real pressures out there to do so.”

Press PLAY below for more.