Super funds call on Federal Government to guarantee contribution increase, but business still not happy
The debate over the Federal Government's proposal to increase the superannuation guarantee from 9% to 12% is once again in the spotlight, with the super industry calling for the proposal to be set in stone.
The call for clarity comes as the government is yet to receive any money from the mining tax – it originally linked the increased super guarantee to the mining tax as evidence it would be sharing the wealth.
Business groups baulked at the suggestion in 2010, saying the government should have given businesses the ability to trade-off increases for higher wages.
Now, superannuation fund managers say they want the government to guarantee the increase despite not having raised enough tax revenue from the mining tax. But business isn't happy.
Daniel Mammone, manager of workplace relations and legal affairs for the Australian Chamber of Commerce and Industry, told SmartCompany the organisation's position remains that there still needs to be a trade-off.
"We're not opposed to the idea of the increase, but our position has always been that it needs to be funded...we don't think it's clear that a funding mechanism has been identified," he said.
"At this stage, it's all being worn by the employer."
Julie Lander, chief executive of the CareSuper scheme, told The Australian Financial Review that if the mining tax doesn't raise enough money then the government will need to find another way to fund the program.
"The government will need to balance the budget and find other sources of revenue to fund all their expenditure to fund an increase in the super guarantee," Lander said.
Damian Hill, chief executive of the REST scheme, says the increased guarantee needs to go forward, and told the AFR the funding required would be minimal on behalf of employers – the rates will rise incrementally through to 2019-20.
"We have a lot more time to determine how the mining tax will play out," he said.
The SME community has been outraged about the superannuation guarantee increase. According to research from the Cameron Research Group last year, more than 90% said it will increase costs and that many intend the increase to be part of a pay rise.