CANBERRA, AAP – Treasurer Josh Frydenberg has branded Labor “flat-earthers” for denying that increasing the superannuation guarantee will hit wage growth.
Mr Frydenberg said a major review of the retirement savings system had found a trade-off between lifting compulsory super contribution and wages.
“That’s not rocket science. The Reserve Bank has said that and the Grattan Institute has said that,” he told Sydney radio 2GB on Thursday.
“Anyone who denies that there is a trade-off is effectively a flat-earther because it obviously is coming out of people’s wages.”
Labor argues the coalition’s decision to freeze the superannuation guarantee in 2014 coincided with a period of historically low wage growth of just above two per cent over six years.
The opposition has also questioned how businesses that say a superannuation increase is unaffordable will be able to boost pay packets.
Mr Fydenberg confirmed the government would make a decision on whether to scrap the legislated increase before the end of the financial year.
On July 1, the guarantee is due to move from 9.5 to 10 per cent before eventually hitting 12 per cent in mid-2025.
The treasurer said the government’s focus was on reducing fees, increasing competition and accountability for super funds.
Superannuation is shaping as a key policy battleground in coming months with unions, industry super funds and Labor fiercely opposed to stopping the guarantee from rising.
The coalition is also mulling a proposal to make the increase optional and allow workers to pocket the money.
Labor and industry super funds baulked at the idea, labelling it an income tax grab.