Economic security for women in retirement
Additional Comments—Australian Greens
28 April 2016
1.1
The Australian Greens believe that all Australians deserve a secure
retirement. The persistence of a gap in retirement incomes between women and
men in 2016 is an indictment of the current retirement incomes system.
1.2
We were pleased to co-sponsor this inquiry, and we are pleased to
support all of the Committee's recommendations. Indeed, many of the
recommendations are long-standing Greens policy which we have been advocating
in the Parliament for many years.
1.3
The Greens would like to thank each organisation or individual who made
a submission to the inquiry, or appeared at a public hearing, and the
Secretariat.
Progressive super tax reform
1.4
In relation to superannuation tax reform (recommendations 8 and 12), the
Greens' plan for progressive tax rates on super would close tax loopholes for
the very wealthy and would tax low income earners less, increasing their
balances. Women make up the bulk of part time workers and lower income earners,
meaning that they are disproportionately affected by our current unfair super
tax system. Our proposal for progressive superannuation taxation was released
in March 2015, well before this issue moved to the centre of national debate.
Our proposal would remove the current flat tax rate of 15 per cent for
everyone, and replace it with a progressive system based closely on the
individual employee's marginal tax rate.
1.5
Two illustrative case studies are:
-
A worker earning $30,000 per year who currently pays 15% tax on
her super contributions would pay only 4% tax under our proposal, equating to a
$40,000 boost over a typical lifetime, retiring with savings of $330,000.
-
By contrast, a worker on $200,000 who currently pays 30% tax on
contributions would pay a tax at a rate of 32%, or $110,000 more over a typical
lifetime, retiring with savings of $1.6 million.
1.6
In relation to paid parental leave (recommendations 6 and 9), the Greens
have long advocated for a policy of 26 weeks (or six months) paid leave for
primary carers, including superannuation to ensure that women are not left
behind while they are caring for young children. As noted by the Productivity
Commission, a well-crafted paid parental leave scheme delivers long run
productivity benefits and increases women's lifetime workforce participation
and earnings. Australia should be moving towards a paid parental leave scheme
that matches the best in the world.
Gender-lens budgeting
1.7
The Greens also particularly support the restoration of a Women's Budget
Impact Statement, which was abandoned in 2014 for the first time in 30 years.
Crucially, the statement must come with a commitment to a gender-lens
budgeting, so that spending and revenue decisions are taken with their impacts
on women in mind. Adoption of a Women's Budget Impact Statement and gender
lens budgeting would complement and build on recommendation 15.
Flexible working arrangements
1.8
We strongly support access to flexible working arrangements such as
part-time work, and flexible working hours. Expanding access to flexible
working arrangements and helping to change the gendered expectations and
culture of work are key to achieving workplace equality, including more equal
retirement incomes. The Greens' Fair Work Amendment (Better Work/Life Balance)
Bill 2012 extended the right to request flexible work arrangements to all
employees with 12 months service, long term casuals and employees with caring
responsibilities. It also allowed Fair Work Australia to arbitrate and issue
orders in disputes with employers. Labor and the Coalition voted together
against the bill.
1.9
Those proposed changes would have substantially implemented the content
of recommendation 4, but they were defeated in the Parliament by Labor and the
Coalition, so we welcome the Committee's position as a somewhat overdue
development.
Super top-ups for women
1.10
In relation to recommendation 16, the Greens welcome the Committee's
position in support of the reforms proposed in the Greens' Sex Discrimination
Amendment (Boosting Superannuation for Women) Bill 2014 which would ensure
employers are able to contribute more super for women employees than male
employees without being considered to have breached anti-discrimination
legislation.
Housing affordability
1.11
The Greens support the Committee's recommendation 19 reiterating an
earlier recommendation designed to address the increasing number of older
Australians, including a large number of older women, experiencing difficulties
or housing stress.
1.12
The Greens have already announced a Homelessness Services Action Plan as
part of our National Housing Affordability Plan which would double the current
funding for specialist homelessness services in Australia for at least the next
ten years under the National Partnership Agreement on Homelessness and National
Partnership Agreement on Affordable Housing.
1.13
Our plan to phase out unfair negative gearing and capital gains tax
discounts would cool the overheated housing market, raise much-needed revenue
and fund construction of affordable housing. The proceeds from phasing out
negative gearing would directly fund construction of 7000 new homes for the
homeless by 2020 and 7500 new social housing dwellings over the forward
estimates. This would be enough to house every person currently sleeping rough
or without adequate shelter, and take more than 15,000 people off the social
housing waiting list in just the next four years.
Gender pay gap - pay transparency
1.14
Many workers, especially those who receive a salary and those in the
private sector, are not allowed to talk about their pay with colleagues. Many
employment contracts include a “gag clause”, which means that workers can be
disciplined or even sacked for discussing their pay.
1.15
Pay secrecy can help hide discrimination, unconscious bias and bad
decision making, such as where two people are paid differently for doing the
same job. Pay transparency makes sure employers have to justify pay decisions.
1.16
Data collected by the Workplace Gender Equality Agency (WGEA) shows that
where pay is set in secret, the gender pay gap is worse. For instance, the
gender pay gap is much smaller in the public sector (12.3%) where workers are
allowed to talk about their pay compared to the private sector (22.4%) where
discussion is often prohibited.
1.17
The Greens' Fair Work Amendment (Gender Pay Gap) Bill 2015 would amend
the Fair Work Act 2009 to ban pay “gag clauses” which restrict women from
comparing their pay with others. The proposed new law would not force anyone to
discuss their pay, but it would make sure that bosses could not pressure their
employees to stay quiet. The Education and Employment Legislation Committee is
currently conducting an inquiry into the Fair Work Amendment (Gender Pay Gap)
Bill 2015.
1.18
We welcome the Committee's conclusion in Chapter 3 that “The committee
does not see any compelling reason for employers to impose these restrictions
on employees.”
1.19
The Greens will continue to work for full equality for women in
retirement incomes and at every other stage of life.
Senator Larissa
Waters
Australian
Greens Senator for Queensland
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