Changes to the amount of superannuation that Australian employers must pay from Saturday July 1 have been welcomed by workers and industry experts alike, with the increased contribution likely to result in young workers having tens of thousands of dollars more come retirement.
As part of a suite of new laws coming into effect from Saturday, July 1, during the 2023-24 financial year, Australian employers will now have to pay workers a minimum 11 percent superannuation rate, up from 10.5 percent.
It is estimated by Industry Super Australia that 8.8 million Australians will benefit financially from the new scheme, with an average of $330 per year added to their retirement funds. They further predict that this will lead to a 30-year-old worker having an additional $48,600 in their retirement savings when they retire.
It has been estimated that around 60% of those who will benefit from this year’s increase are younger and/or earn less than $75,000 annually.
The additional amount of $21,500 provided to recent school leavers who work in low-income or middle-income jobs until the new age pension age of 67, although seemingly insignificant, will markedly improve their final super balances.
Furthermore, women taking extended career breaks to give birth and look after their children can expect their super balances to increase by at least $17,000 at retirement.
Jim Chalmers, the Treasurer, argued if the Liberal Party had not blocked the increases of the super guarantee in 2014, Australian workers would have achieved the 11 per cent threshold in 2017 and the 12 per cent threshold in 2019.
“We believe in providing all Australians with a dignified retirement, which is why the super guarantee is so important. Labor has always stood behind this guarantee, and today it increases to 11%, offering more hardworking Australians extra money in their retirement fund,” he said.