Australian Govt Must Commit to Repaying Our $50 Billion Superannuation ‘People’s Loan’
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Covid-19 shouldn’t leave Australia with an even more entrenched retirement underclass in 30 years.
We call on the Australian Government to commit to Dollar for Dollar Super contribution matching for all accounts valued below $100K in 2022, up to a contribution value of $22K.
At the beginning of April, the Morrison Government confirmed that as of April 20th retrenched workers and those suffering financial hardship because of shutdowns will be allowed to access up to $20K of their super. More than half a million people registered their intent with the Australian Taxation Office in the first fortnight.
No matter the "financial advice", by necessity this money will quickly trickle up to landlords and bankers, and contribute to the balance sheets of large corporations and multinationals.
It is projected that as much as $50 billion could be lost from people’s retirement savings — functioning as a gigantic “people’s loan” that will spare the government from borrowing billions elsewhere to support us (and the landlords, bankers, corporations, and multinationals) during the crisis.
But Australians taking money out of our retirement savings haven’t been asked if we consent to participating in this multi-billion dollar informal bailout.
If you're poor, you lose now and you lose later.
And the nature of compound investments means that the losses are heavier than they seem.
For the average 20 year old who accesses $20K now, their projected retirement shortfall could be as much as $120K.
For the average 30 year old, a full withdrawal of $20K could cost them $100K.
A 40 year old’s estimated losses are up to $63K.
So let’s at least be honest: people aren’t “choosing” to take money out of their Super.
We know it’s a move that will have a significant impact on our retirement income in the long term.
But getting evicted, getting the phone cut off, or not eating has real impact right now.
That’s not much of a “choice”.
The Australians whose retirement savings will take the biggest hit are, as always, those who can least afford it. It’s the young, it’s women, it’s casuals, it’s workers earning at or below minimum wage. These are the Australians who will be losing the biggest proportion of their nest egg — and it will take them the longest to replace that money.
For some working Australians this could wipe out 15 years of savings in one blow.
For many, these are the only savings they have.
The only fair solution is that this $50 billion people’s loan must be repaid gradually as a part of any Covid-19 recovery plan.
To achieve this, we call on the government to commit to Dollar for Dollar Super contribution matching for all accounts at or below $100K at EOFY June 30th 2022, up to a total matched contribution of $22K.
Put simply: if in 2022 your Super account balance is $0, by the time you or your employer have put $22K into your super account, with a matched contribution of $22K, giving you $44K to add to for the future. If the starting balance was $100K, the same maths will take you to $144K.
These measures will be in addition to existing schemes surrounding superannuation and taxation, and will not incur tax. This will help restore the primacy and sovereign of our widely and internationally respected universal superannuation system, which until now hasn’t had to consider or address sovereign risk.
To make a change you are going to need to do something, we all will, sign this petition and contact your MP .
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