Wages and super should be aligned: Cbus

Cbus is calling on the Federal Government to align the payment of workers' superannuation with the payment of wages.

The industry super fund claims the quarterly payment cycle for the superannuation guarantee creates a significant risk of non-compliance and increases opportunities for payments to be missed.

"The most effective solution to the growing problem of unpaid superannuation is to try and prevent it happening in the first place," Cbus chair Steve Bracks said in his submission to the Senate inquiry into unpaid superannuation.

"Paying superannuation at the same time as wages is a key part of the answer."

Cbus found that non-compliance with superannuation guarantee payments had four main sources, including employer non-compliance, the rise of the cash economy, sham contracting and employer insolvency. Late last year, Cbus and Industry Super Australia released a report which estimated Australians were missing $3.6 billion in superannuation each year.

A recent survey of Cbus member also found 14.7% reported experiencing a problem with unpaid superannuation and only 60% of members were confident their super had been paid. More than a third of those who had experienced unpaid super reported that their issue had not been resolved.

Cbus also called for the current loophole that allows salary sacrifice to be counted towards superannuation guarantee compliance to be closed.

"We appreciate that superannuation can be complex for employers and for employees; however, given the tools available, we do not believe there is any compelling reason super cannot be paid at the same time as wages," Bracks added.

"The impact of missing superannuation can be dramatic on individuals and the wider community with lost tax revenue and increased reliance on the age pension. We all lose from unpaid super."

Cbus also called for the current loophole that allows salary sacrifice to be counted towards superannuation guarantee compliance to be closed.

The Senate Economics Committee is holding hearings in Melbourne today into unpaid superannuation and will be making recommendations on how to improve the system.

Read more: CbusFederal GovernmentAustraliansIndustry Super AustraliaMelbourneSenate Economics CommitteeSteve Bracks
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