Good news for thousands of Aussie workers, especially women – the Federal Government is set to scrap the $450 per month minimum threshold for super guarantee payments.
The income threshold, which kept an estimated 300,000 people from receiving super payments, will end on 1 July, 2022, meaning employers will now have to pay super on every dollar an employee earns.
According to Ian Yates AM, Chief Executive of Council on the Ageing (COTA) Australia, the threshold left disadvantaged Australians out of superannuation payments, and its removal addresses a “significant inequity” in the super system.
“Australians earning less than $450 a month from a single employer are often in insecure work and holding multiple jobs that add up to more than $450, but they receive no super on any of it.
“Women have been disproportionately disadvantaged by this system. Female-dominated industries are low paid, and women are more likely to work part-time and casual, putting many beneath this $450 threshold,” he said.
“After calling for this reform for many years, it’s pleasing to see it passed today and know that Australians on low incomes will have a fairer go at a dignified and happy retirement.”
Debbie Blakey, CEO of health and community services super fund HESTA – which has 80 per cent female membership – says ending the “outdated” threshold will make the system fairer for women and low-wage workers.
“Our members spend their working lives caring for others and the long overdue removal of this threshold will ensure that they’ve now got a better opportunity to enjoy a more financially secure retirement.
“The fact that super continues not to be paid on parental leave remains an obvious gap in our super system that needs to be addressed,” she said.
Given that the legislation was bogged down in Parliament for much of last year despite being proposed in the 2021 Budget, it’s definitely well overdue.
