New research has shown that WA state has the largest gender gap in superannuation, with the average female’s account balance across the region being 39 per cent less than that of their male counterparts, sitting higher than the national average of 30 per cent.
The study commissioned by Women in Super was based on an analysis of the account balances of 4 million members of five large industry super funds by Rice Warner.
The average super balance for women in WA was found to be $84,000, in contrast to $132,000 for men.
Queensland had the second-highest gap of 34 per cent, followed by South Australia and Tasmania, which both had gaps of 33 per cent, Victoria at 31 per cent, NSW at 21 per cent.
The ACT and Northern Territory had the lowest gaps at 20 per cent and 16 per cent, respectively.
The Australian Institute of Superannuation Trustees (AIST) said the gap in savings is caused by a number of factors, including women being paid less than men, women taking more time out of work to care for children and family members.
“These income differences are amplified by superannuation tax settings, which penalise low-income earners, and they compound over a lifetime,” the AIST said.
AIST and Women in Super have agreed that the measures that will address the super gap include abolishing the $450 monthly income threshold for compulsory payments, paying super on paid parental leave, and providing low-income earners with an additional super contribution.
Both organisations also requested a firm commitment from the government to move to 12 per cent compulsory super from the current 9.5 per cent.
“Better policy is needed if we are to make a difference to the retirement outcomes of all Australian women,” Cate Wood, national chair of Women in Super, said.
“We have tinkered around the edges for too long. It is time to implement structural changes that deliver real improvements for women.”
AIST CEO Eva Scheerlinck said that with an estimated 40 per cent of single women retiring in poverty, there was an urgent need for real change.
“The gender savings gap has been sitting around these levels for a long time,” Ms Scheerlinck said.
“We need brave and substantial, systemic reform that redresses this imbalance once and for all.”
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
You can contact her on [email protected].
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