Yahoo Finance Budget 2023: Millions of Aussies to get $50k superannuation boost
The way Aussies are paid their super is about to change forever.
The government has announced a major change to how Aussies are paid their superannuation, and millions could see a serious cash benefit.
Super will now be paid in line with wages so, if you’re paid fortnightly, so will your super and, if you’re paid monthly, so will your super.
You may have thought that’s what was already occurring, but super was previously only mandated to be paid quarterly, which some estimated had cost Aussie workers $33 billion in unpaid super over seven years.
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Treasurer Jim Chalmers and Assistant Treasurer Stephen Jones said millions of workers would benefit from the change, which it wanted to start from July 1, 2026.
“This simple change will strengthen Australia’s superannuation system and help deliver a more dignified retirement to more Australian workers,” they said in a statement.
Industry Super Australia (ISA) said moving super payments to align with wages could give millions of Australians $50,000 more at retirement and drastically curb Australia’s unpaid super scourge.
“The one in four workers currently underpaid every year will get a huge boost to their super savings,” ISA said.
“This measure is a big win for younger workers, those in blue-collar jobs, hospitality and retail workers who bear the brunt of unpaid super.”
ISA said it would also benefit more than 1 million younger women who were often lower-paid and short-changed.
“Unpaid super can cost some women as much as 10 per cent from their final nest egg – a crushing financial blow when women already retire with about a quarter less super than men,” it said.
Why make the change?
Businesses will now be on a level playing field and have a smoother payroll-management system that will no longer lead to the building up of large super contribution liabilities at the end of each quarter.
Quarterly super payments made it difficult for workers to keep track of payments and for the ATO to monitor compliance in real time. This move means the ATO can use real-time monitoring and act quickly when a complaint is lodged – no longer having to wait until the end of the quarter to launch an investigation.
“This is a big win for the 3 million mostly young and lower-paid Australians unfairly deprived of the super they’ve earned and will give them a better shot at building a good nest egg for retirement,” ISA CEO Bernie Dean said.
“The government should be commended for listening and then taking the necessary steps to end the huge super rip-off which was undermining the future economic security of too many young women and others on lower incomes.
“Aligning payment of super and wages is the right thing to do by workers, boosts government revenue, lifts investment returns and puts all employers on a level playing field.”
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