Close to 60% of Australian small businesses support an increase in the compulsory superannuation guarantees, according to a survey released on Friday by super fund Sunsuper.
While the compulsory superannuation guarantee will now be frozen for seven years and not increase to 12% until 2025 thanks to a deal reached by the government and the Palmer United Party, the survey found Australian SMEs were largely in favour of helping their staff prepare for retirement through superannuation.
The survey of 500 SMEs found 59% supported an increase in the amount of super employers must put aside for their employees, while 14% strongly supported a superannuation guarantee above the current rate of 9.5%.
Support for an increase rose to 85% for companies with 20 or more employees.
A majority of survey respondents (55%) said they would fund an increase from their company’s savings, while 21% said they would halt pay rises to cover the extra costs, 15% said they would reduce bonuses and 9% said they would cut salaries.
In the case of a delay in the increase, 77% of SMEs said they would reinvest those funds in their business, 10% said they would give their staff a pay rise, 9% said staff would receive bonuses, and 3% said the extra cash would go towards a staff party.
“It’s encouraging to see that most Australian business owners were planning to fund the superannuation guarantee themselves, rather than from employees’ pay,” said Sunsuper chief executive Scott Hartley.
“It shows that they care about helping their employees save for retirement, ahead of their own interests.”
“It also further highlights what a disappointment [the] announcement of the seven-year delay to superannuation guarantee rate increase could be for many Australians,” he said.
However, industry groups last week welcomed the freeze on the superannuation guarantee rate, which they say will provide welcome relief for businesses of all sizes.
“Australia has become a high-cost, low-productivity country and the delay in the imposition of a rise in costs of employment will provide welcome relief over the next few years,” Australian Industry Group chief executive Innes Willox said in a statement last week.
“The delay will give business an opportunity to build the productivity growth necessary to sustain the rise in the superannuation guarantee.”
Peter Strong, executive director of the Council of Small Business of Australia, labelled the Sunsuper survey findings “ridiculous”.
“What a joke!” Strong told SmartCompany this morning.
“Here we have another industry super fund, probably scamming their members and conducting push polling.”
“Someone should tell all the industry super funds they could save $2 billion a year of their members money if they changed the way they collected super,” Strong says.
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Eloise is an experienced business journalist and editor, who has held senior editorial roles at SmartCompany since 2014. Prior to joining SmartCompany, Eloise was news editor at Books+Publishing, the trade press for the Australian book industry. Eloise has degrees in media and communications, marketing and business management, and political science. You can follow her on LinkedIn, and Twitter at @ellykeating.
