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Super Rate 10% from 1 July 2021

The looming tower of an additional $18 billion per annum (2.5% of pay) being phased in from 1 July 2021 by employers as additional compulsory superannuation contributions, is starting to attract media interest from activist groups in Australia. See Tax Office Guide to year by year SG rates from 1 July 2021 http://www.ato.gov.au/rates/key-superannuation-rates-and-thresholds/?anchor=Superguaranteepercentage

What seemed like a populist cause (pay in super instead of in the pocket) in 1993 in a higher unionised workforce in a wages freeze, might not be so welcome when pay in the pocket might be much more preferable now for the underemployed, gig workers and part time women.

Another factor to consider is the significant increase in welfare since 1993. The Single Person Age Pension has risen from 26% of Average Weekly Earnings to 28%. The NDIS is providing a significant safety net (about $30bn a year) for adverse events in life. Maybe people won't see as high a priority on getting money out of a complex institution like a superfund - sometime in the long term future, rather than money in the pocket now.

Posted Wednesday, 5 February 2020

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