Corporate Australia has a responsibility to do more to solve the problem of retirement inequality, rather than looking to the government to address issues within the superannuation system, argues Challenger.
Speaking in Sydney yesterday, Challenger chief executive Brian Benari said Australian companies have a big opportunity to “make a difference” when it comes to retirement income.
“I personally believe that this [solving the problem of retirement inequality] is something that every company that can afford to, should do,” he said.
“Government has an important role to play in setting the right superannuation policy and we absolutely need to hold them to that task. But we can’t look to the government to solve all our super issues.”
Mr Benari cited statistics that indicate even younger women who have the benefit of the superannuation guarantee (SG) system for their whole working life may still have 30 per cent less than men when they retire. Indigenous Australians also fare poorly, with Griffith University research showing that this group will retire with about 27 per cent less savings.
Challenger is making inroads into redressing the balance, with Mr Benari telling the audience that the annuity provider pays superannuation guarantee payments for employees on parental leave.
“For each individual employee, this is a relatively small payment but it can make a big difference,” he said.
Mr Benari continued that big corporates would reap rewards for becoming retirement advocates.
“What’s the pay-off for companies?” he asked. “It’s the ability to attract and retain the best employees.”
Education about retirement benefits and risks and encouraging staff to consider salary sacrifice as well as paying superannuation guarantees during parental leave are all opportunities for companies, Mr Benari said.
“Corporate Australian can help by addressing some of the inequality in the system and, alongside super funds, helping employees be more engaged in their super outcomes,” he said.
“The financial services industry has a role to play in developing a wider range of products that help address the changing needs of retirees.”