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December 4th, 2015
Before the inquiry into Economic Security for Women in Retirement reports its findings, the senator tells how we can work together to achieve real change.
As the Chair of the Australian Senate’s inquiry into Economic Security for Women in Retirement, Senator Jennifer McAllister wants to know why so many Australian women enter retirement financially underprepared, and what can be done about it.
Currently, the gender pay gap between men and women in Australia sits at 18%, a number that increases to 46 per cent (thanks to the miracle of compound interest) when we talk about the super gap. Currently sitting, the inquiry has heard submissions from witnesses and groups aiming to tackle those disturbing numbers.
Senator McAllister says while young women are often in the dark about the gender super gap, sadly by the time they reach retirement age they’re all too aware of their disadvantages.
“I’ve found during the inquiry that older women are acutely aware of, the problem, and particularly women who enter retirement single,” she says.
According to the Senator, 40% of women are single when they enter retirement, exacerbating the affects of the super gap.
“Even if they’re not single, there’s no guarantee that their man will have enough super in his account to provide for them,” she says.
When it comes to women’s finances in retirement, Senator McAllister says the “three pillars” should always be considered: the aged pension, super and private savings.
“We need to be aware of how important each element is, because they don’t make sense without each other,” she says.
She says the biggest barriers to significantly changing women’s income include the availability of childcare, flexible work conditions and the ability of women to occupy roles “traditionally believed to only be suitable for men”.
While transparency is often touted as one of the biggest issues, Senator McAllister says the above can affect real change, rather than simply raising awareness.
On an individual level, the Senator says women not only need to be more aware of their own finances and future plans, they also need to be having serious conversations with their partners while they’re young.
“There needs to be a really direct conversation about the balance of household duties in their own household,” she says.
“We need women and men to share a similar burden, and that’s a job for women, men, the Government and workers.”
The Labor Government’s abolition of the low-income super contribution this year will affect the 3.6 million low-paid workers who currently access it, two thirds of which are women, according to Senator McAllister.
“The super pay gap is a product of the gender pay gap, which is a product of the way our workplaces are organized.”
Despite the disheartening numbers, Senator McAllister says the inquiry is considering a range of options before delivering its findings next March. And many of them will depend on the input of more than just women.
This publication was issued by First Super Pty Ltd (ABN 42 053 498 472, AFSL 223988), as Trustee of the First Super superannuation fund (ABN 56 286 625 181).
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