Australian workers back compulsory super but tight economic times mean some no longer want to top it up from their own pockets.
A Newspoll survey, released on Tuesday at a superannuation conference on Queensland’s Gold Coast, reveals 37 per cent of those making voluntary super contributions will stop doing so.
Fiona Reynolds from the Australian Institute of Superannuation Trustees says there are several reasons voluntary top-ups are slowing.
She said respondents who indicated they’d stop voluntary payments included those who’d lost jobs, were making extra mortgage repayments while interest rates were low, and those who’d reacted to negative growth in superannuation funds.
“For the major superannuation funds, it won’t have too much of an impact in that they have very strong compulsory superannuation flows,” Ms Reynolds said.
“Some of the big funds have $100 million that comes in every month in investable money.”
Smaller funds could have difficulty managing cash flow but should not face liquidity problems, she said.
More people were “engaged” with their superannuation than commonly thought, she said.
National Seniors Australia chief executive Michael O’Neill said the compulsory nature of superannuation meant it should be continually scrutinised.
“The industry needs to retain the confidence of the community that it is performing and effectively managing the funds that have been provided to them,” Mr O’Neill said.
“The superannuation industry will be increasingly amongst the biggest portfolio holders in the equities market.
“They need to be actively protecting the investments of ordinary Australians.”
The survey also showed 81 per cent of 1,000 respondents thought superannuation was a good way to invest.