Fund trustees should step in to mitigate unpaid super: IFS
Early intervention by superannuation fund trustees is critical to addressing unpaid super, Industry Fund Services (IFS) believes.
Pointing to data by the Australian Taxation Office (ATO) that found Australian workers had been underpaid $17.1 billion in compulsory super entitlements from 2009 to 2015, IFS said 90 per cent of employers with unpaid super employed 10 or fewer fund members.
The tax audit also found that small-to-medium businesses in the construction, retail, food services, and accommodation sectors were the worst offenders.
IFS chief executive, Cath Bowtell said: “Most employers do not set out to fall behind with super payments, and most cases are resolved, without recourse to litigation”.
Bowtell said that often the fund trustee was the first to know that a payment was missed.
“The earlier the super fund trustees act to recover unpaid super, the more likely the debt will be paid with a simple phone call,” she said.
IFS said this was apparently in insolvency cases, where the age and size of the debt was smaller for members of funds with an active arrears process compared to those with a less robust process.
IFS also welcomed the Government’s changes to give the ATO greater power to crack down on non-compliant employers.
Recommended for you
Unveiling its performance for the calendar year 2024, AMP has noted a “careful” investment in bitcoin futures proved beneficial for its superannuation members.
SuperRatings has shared the median estimated return for balanced superannuation funds for the calendar year 2024, finding the year achieved “strong and consistent positive” returns.
The second tranche of DBFO reforms has received strong support from superannuation funds and insurers, with a new class of advisers aimed to support Australians with their retirement planning.
The financial services technology firm has officially launched its digital advice and education solution for superannuation funds and other industry players.
