The superannuation savings gender gap is worse in Western Australian than every other Australian States, according to new research commissioned by Women in Super.
The research – based on an analysis of the account balances of 4 million members of five large industry superannuation funds by Rice Warner – found that WA has the biggest gap between men and women’s superannuation balances, with the average super balance for a female in WA being 39 per cent less than the average male in WA.
The average super balance for a female Western Australian is $84,000, which is $48,000 less than the average super balance for a male in Western Australia.
The gender gap in superannuation savings is caused by a number of factors including women being paid less than men, and women taking more time out of work to raise children and care for family members. These income differences are amplified by superannuation tax settings which penalise low income earners, and they compound over a lifetime.
Women in Super national chair, Cate Wood, said it was unfortunate to see WA high on the list of worse states for the super gender gap.
“Better policy is needed if we are to make a difference to the retirement outcomes of all Australian women, including those in WA,” Ms Wood said.
“We have tinkered around the edges for too long” said Ms Wood. “It is time to implement structural changes that deliver real improvements for women.”
AIST CEO Eva Scheerlinck said that with an estimated 40 per cent of single women retiring in poverty, there was an urgent need for real change.
“The gender savings gap has been sitting around these levels for a long time. We need brave and substantial, systemic reform that redresses this imbalance once and for all,” Ms Scheerlinck said.
Key measures that AIST and WIS agree will have the biggest effect on addressing the super gap and improving retirement outcomes for women include:
- Abolition of the $450 monthly income threshold for compulsory super payments
- Paying super on paid parental leave – this is the only form of leave that doesn’t attract super
- Providing low income earners, most of whom are women, with an additional super contribution.
- A firm commitment to move to 12% compulsory super in accordance with the legislated timetable.
How the states measure up
How much less super women have compared to men on average*
*Rice Warner analysis of the account balances of 4 million members of five large industry superannuation funds