Gig economy to uncover more super concerns
The rise of a gig economy where buyers and sellers are matched on web-based platforms will negatively challenge the effectiveness of the current superannuation system for contract employees, according to the Association of Superannuation Funds of Australia (ASFA).
ASFA has today released a discussion paper in which chief executive Martin Fahy pointed to concerns for independent contractors and self-employed workers not covered by the Superannuation Guarantee (SG).
“Workers who already operate under some form of independent work arrangement – such as independent contractors – will migrate onto web-based platforms and new gig economy jobs will be created,” Fahy said.
“However, the current superannuation settings are not suited to these trends.”
ASFA found self-employed workers had lower superannuation balances than employees across every age distribution. In the run-up to retirement between ages 60 and 64, self-employed workers were expected to have just have the amount of super held by salary workers.
“For affected workers and in the absence of any policy reforms, a growing gig economy would mean lower superannuation balances at retirement,” Fahy said.
“This would reduce the broader adequacy of the superannuation and retirement income system.”
The ASFA discussion paper outlined proposals for the adjustment of current settings which included:
- Extension of the coverage of the SG to independent contractors and the broader group of self-employed workers.
- Removal of the $450-a-month wages threshold for the SG to be paid to employees.
AUTHOR
Hope William-Smith
Recommended for you
The financial services technology firm has officially launched its digital advice and education solution for superannuation funds and other industry players.
The ETF provider has flagged a number of developments as it formally enters the superannuation space through a major acquisition.
While all MySuper products successfully passed the latest performance test, trustee-directed products encountered difficulties.
Iress has appointed Insignia Financial’s former general manager of master trust and insurance products as its newest CEO of superannuation, who will take over from Paul Giles.
