Dear Jane Hume,
Congratulations on being appointed Australia’s first Minister for Women’s Economic Security. It’s a big job and long overdue, write Brendan Coates and Rebecca Joiner in The Age.
No doubt high on your agenda will be ensuring economic security for women as they approach retirement. As you probably know, women currently retire with one-third less superannuation than men. Their incomes are roughly 10 per cent lower in retirement. And women – particularly if they are single, divorced, or widowed – are much more likely to suffer poverty, housing stress and homelessness in retirement.
Minister, we wish you well in seeking to close this gap, but beware: some policy proposals put to you will actually make the problem worse.
Minister, here’s what you should do to improve women’s economic security in retirement.
First, instead of expanding super tax breaks, rein them in. Those tax breaks cost a lot – about $35 billion a year – but actually do little to encourage extra savings.
In fact, by 2040, super tax breaks are expected to cost the government more than the age pension and they overwhelmingly benefit men (who earn more) over women (who earn less).
If you really want to guarantee women’s economic security in retirement, your priority should be closing holes in the social safety net. Single women who do not own their home are at greatest risk of poverty in retirement and are the fastest growing cohort of homeless Australians.
That will require a range of reforms that go well beyond the scope of retirement income policy, starting with cheaper childcare. May we suggest that in the meantime, you should get busy fixing the social safety net.
Good luck minister, the women of Australia are relying on you.
Brendan Coates is director of the household finances program and Rebecca Joiner is an associate at the Grattan Institute.
FULL ARTICLE
Women’s financial security in retirement should be high on minister’s agenda (The Age)
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Jane Hume (Liberal Party Victoria)
