Last week in SuperWrap we wrote about a positive sign for one of the super system’s most persistent blind spots: the growing national momentum to end a rule that denies many workers under 18 the same super rights as everyone else.
This week, SMC released new modelling to put a sharper focus on the scale of this problem and, significantly, that the size of the issue is growing.
Our latest analysis shows that about 530,000 teenage workers will miss out on $411 million in super this financial year because of the under-18 exclusion.
That’s 25,000 more young workers than just two years ago, while the amount of super they are denied has grown by 7% over the same period.
Currently, over 90% of teenage workers are denied super because they are employed part-time, despite doing the same work as their older colleagues who receive super from their first hour on the job, and despite paying their taxes like everyone else.
For the average affected teenager, the exclusion means missing out on around $780 in super contributions each year, which adds up to around $2,500 by the age of 18, and compounds to a loss of about $11,000 by the time they reach retirement age.
As the pool of young workers being excluded from super grows, and the super they miss out on grows too, the stronger the case for reform.
Australia’s super system works best when it is simple, universal and fair. Allowing every worker to receive super from the first hour of their first job would move us one step closer to that goal.
