Super fund Cbus backs call for 15 pct levy

One of Australia’s largest industry funds has thrown its weight behind calls for superannuation to get to 15 per cent.

The compulsory super levy for employers increased to 10 per cent last week and is legislated to step up to 12 per cent over the next four years, despite a campaign by some government members to block the rise.

Cbus chief executive Justin Arter told the first parliamentary grilling for superannuation this year that 12 per cent was the aim but 15 per cent would be better.

The $63 billion fund’s My Super option has made almost 20 per cent for members in 2020/21, its largest ever annual return, and Cbus was one of a handful of funds making a positive return the previous year.

He said 15 per cent would lead to better retirement outcomes for members.

The fund manages the savings of many contractors who experience insecure work and who are more likely to have work-related injuries and be forced into early retirement.

The average balance of its members is modest, just $137,000 at retirement.

Mr Arter said insurance was also essential protection because members worked in hazardous industries and many would find it difficult to find cover in the retail market.

Australia’s largest superannuation fund, Australian Super, has one in every 10 workers as members and more than $100 billion invested across the economy.

Chief executive Ian Silk was coy on delivering a larger than legislated rise.

“We’ve got a major challenge, I expect, to get to 12 per cent,” he said.

Economics committee chair Tim Wilson and some other Liberal backbenchers are opposed to the increases.

Some want the superannuation system scrapped altogether.

Mr Arter rejected Mr Wilson’s assertion a rising levy on employers would come at the expense of wage growth.

The Australian Council of Trade Unions wants new laws to lift the superannuation guarantee to 15 per cent. 

The ACTU also calls for women to reach 15 per cent at an accelerated rate to grow what tend to be their more modest nest eggs. 

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