Aussie workers set for $2bn superannuation boost
Billions of dollars in unpaid super could soon be arriving in the accounts of hardworking Australians as businesses are forced to cough up payments.
About 860,000 businesses have been put on notice by the Australian Taxation Office who has started sending out letters to businesses urging them to fess up short-changing workers or face serious penalties.
It is understood more than $2 billion in unpaid super is owing to workers.
Employers have just under five weeks to declare they have failed to pay their employees their correct super amounts during their employment.
To take up the amnesty businesses must come forward to the ATO before September 7 and do either of the following options:
• Pay unpaid amounts of superannuation in full with interest.
• Be put on a payment plan to repay the money.
It applies to any payments since the rollout of compulsory super began in 1992.
Despite many businesses already facing immense stress during the COVID-19 pandemic no extension will be given to businesses to get their financial affairs in order.
Assistant Minister for Superannuation Jane Hume said it was vital Australian workers received their super entitlements.
"There would be many people out there for whatever reason accidentally been unpaid superannuation some time since 1992," she said.
"Superannuation and the award system is complicated, it's often for employers to make a mistake."
She said the super guarantee amnesty enabled employers a once-off opportunity to come forward, pay or put up a plan in place to pay and set things right before September 7.
The super amnesty was rolled out in March this year and before many businesses were put under increased financial strain.
Already under the Federal Government's early access to super scheme latest Australian Prudential and Regulation Authority statistics showed $32.5 billion has been paid to more than 2.6 million applicants.
The artitect of superannuation former Labor Prime Minister Paul Keating criticised the scheme this week and said it should be shut down.
"Of the income support in Australia to date during the COVID crisis, $32 billion has been found and paid for by the most vulnerable, lowest-paid people in the country," he told a superannuation webinar," he said.
Minister Hume hit back and said cash-strapped Australians could always access their super for compassionate purposes.
"All we have done here is change the criteria to respond to an urgent need brought about through the COVID-19 pandemic," she said.
"It does it allow people who are still being affected by this to take more time to consider whether accessing their super early is the right solution for them."
Those who have suffered income hits can access up to $20,000 tax free, including $10,000 this financial year through until December 31.
When compulsory super was introduced the compulsory payment rate was 3 per cent of a person's salary and this has gradually increased to 9.5 per cent today.
The rate is scheduled to 10 per cent in July next year and then up to 12 per cent by July 2025.
For more information go to ato.gov.au/sgamnesty or contact the ATO emergency support hotline on 1800 806 218.
Originally published as Aussie workers set for $2bn superannuation boost