The nationwide sense of relief that we’re (mostly) no longer subjected to Tony Abbott’s malapropisms, thoughtless slogans and race-baiting is understandable, but that doesn’t mean we should get too comfortable. Turnbull might be easier on the brain that Abbott, but policy still matters. Particularly with regards to superannuation, and even more particularly for women.
Scott Morrison’s recent speech on superannuation should be setting off alarm bells for all of us. Whether the initial purpose of super was to replace the old age pension is probably irrelevant now, it’s been decades since Hawke and Keating started streamlining it and it’s not unreasonable for policy to change in that time.
It’s also reasonable, even necessary, for government to initiate reforms to ensure welfare spending is sustainable for our aging population. The devil, however, is always in the detail. Morrison, who may or may not be the devil, has, so far, been quite short on detail.
He said yesterday that superannuation should be the key to a comfortable retirement for all Australians, and that the age pension should only be considered a safety net, not an entitlement.
If this is going to be the cornerstone of government policy, women need to be very concerned. The combination of the gender pay gap, the predominance of part-time work and the significantly higher rates of time out of the workforce among women, means they retire with substantially less superannuation than men. Given that they also live longer and the cost of retirement is much higher for single women, the long term effects of changes to superannuation policy needs to be examined very closely.
The Age reports that
…the age pension should not be regarded as an entitlement for all, but rather a “welfare payment for those who do not have the ability to save enough to fund their own retirement”, Mr Morrison said.
Mr Morrison said the age pension should remain “as a safety net”, and that people who take time out of the workforce to raise children or perform carers duties should not be left behind.
Ok, well good, but how exactly are they going to ensure that women are not “left behind”? Because developing policies to encourage people to put more money into super will have no effect without concurrent policies to increase women’s lifetime earning to the same level as men’s. “Flexibility” on the rules and “allowing women to catch up” only works if women are able to earn more money.
Superannuation is not something that only happens at the end of working life, it is the result of an entire lifetime of work, and policy on superannuation needs to consider the significant gender difference in lifetime earnings.
As I have written before, the stated gender pay gap of 18% is not the full picture, it is the difference between total weekly cash earning of men and women who are working full time. When you take into account all the women working part time, and look at the total difference between what men earn and what women earn, the difference is actually around 50%. The gender pay gap increases, it doesn’t decrease, as women age, so the idea that they can just “catch up” is ludicrous.
The gender difference in superannuation is not a welfare issue. It’s about ensuring that women are able to access financial security over an entire lifetime, it requires clear acknowledgment of the gender barriers to achieving it and taking real action to address it.
Turnbull has promised wide ranging reforms, and has said time and time again that everything is on the table. If addressing the gender pay gap isn’t on the table, and sitting right on top of reforms to superannuation, Australian women are going to pay a very high price. And in the end, that’s bad for everyone.