This week at the Australian Financial Review’s Superannuation Lending Roundtable, we were once again treated to politicians suggesting that a portion of superannuation savings should be directed into areas of sovereign capability such as housing, infrastructure, the energy transition and pandemic preparedness.
While such interventions are predictable, they are also unhelpful. They distract from what must remain super’s sole purpose: to grow the retirement savings of everyday Australians.
It is not the job of super funds to solve every problem in our economy. Nor should it ever be.
It is true that such is the success of Australia’s super system, it has become a valuable source of economic diplomacy for Australia. The fact that the world’s largest economy, the USA, is looking to emulate Australia’s system is testament to its success.
Now, there is nothing wrong with using Australia’s vast pool of pension capital to strengthen relationships with our biggest trade partners. But politicians shouldn’t pretend that super funds will invest in anything that isn’t in the best financial interests of members.
Our consumer research consistently shows that Australians love their super and want it invested in a way that maximises their long-term retirement savings.
At a time where there is mistrust in institutions, research shows super still tracks high on the trust barometer and that’s because of the tangible benefits it is delivering for Australians by increasing their wealth, regardless of where they sit on the income and wealth scales.
A report we released earlier this year reveals why. It found wealth levels for middle Australia have tripled in 20 years for recent retirees, with superannuation the key driver of that strong growth in prosperity.
From 2002 to 2022, non-housing wealth grew by 196% for middle Australians, making them more than $256,000 better off in retirement.
This means more money in retirement for Australians and less pressure on the Age Pension, saving taxpayers money.
In the three decades since the Super Guarantee was introduced by then Prime Minister Paul Keating, both major parties of Government have contributed to its success.
This is a reminder that it is incumbent on politicians of all colours to safeguard it.
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