(Australian Associated Press)
Industry funds and Labor have lashed out against a proposal to allow workers to opt for more take-home pay instead of a higher superannuation guarantee.
The coalition government is considering scrapping the legislated rise in the guarantee from 9.5 to 12 per cent to be spread over the next four years.
But another option has been floated in a Nine newspapers report, with unnamed government sources confirming a plan to let workers choose to take home the increased contributions is under consideration.
Industry Super Australia railed against the idea, arguing that making the increase to 12 per cent optional would cost the average Australian family $20,000 in extra income tax.
ISA deputy chief executive Matthew Linden said the government should not be exploring underhanded ways to renege on sticking to the legislated increase.
“Removing the guarantee in the super guarantee to make it optional is a recipe for higher taxes, lower lifetime incomes and a red tape nightmare for business,” he said.
“This isn’t choice – it’s a sneaky tax grab that will leave people worse off and rip up one of the system’s founding principles.”
Shadow treasurer Jim Chalmers said the coalition was using the pandemic to cut wages and superannuation at the same time.
“They should stop pretending that they want higher wages or that they want higher super – this government wants neither,” he told Sky News.
Liberal MP Tim Wilson, who opposes a higher superannuation guarantee, said shrill outrage against the idea was predictable.
“It’s the sound of hogs being dragged away from a multi-trillion trough they use to pay themselves bonuses in the tens of millions at the cost of take home pay and home ownership,” he tweeted.
Treasurer Josh Frydenberg and Superannuation Minister Jane Hume have previously pointed to a range of studies that argue a higher guarantee could mean lower wages growth.
Mr Frydenberg has also said coronavirus put Australia in vastly different economic circumstances to 2019 when the coalition promised to stick to the legislated rise.