The Morrison government wants to delay the increase in superannuation from 9.5 per cent to 12 per cent – a move that would cost a 30-year-old registered nurse more than $120,000.

On 1 July 2021, your super will increase without you having to do anything.

Unless, that is, an influential group of federal Liberal MPs gets its way and torpedoes the rise.

Increasing employer contributions to super – known as the “super guarantee” – has already been legislated. The super guarantee is scheduled to rise from 9.5 per cent to 10 per cent next year and to 12 per cent by 2025.

The increase was legislated to come into effect in 2015 but was delayed by the Abbott government.

Now Prime Minister Scott Morrison, Treasurer Josh Frydenberg, and assistant superannuation minister, Jane Hume, have put into doubt the super increases, arguing they are unaffordable and would hurt wages and cost jobs.

A group of Liberal Party back-benchers goes even further. They too have called for the increase in the super guarantee to be delayed or cancelled. But they have also called for super to be optional for workers, or to be used to live on during the coronavirus crisis or to buy a house.

If implemented, these proposals would fundamentally change Australia’s world-respected superannuation system.

The ACTU has calculated a further delay in the super guarantee would cost a 30-year-old registered nurse $121,807 at retirement and a 30-year-old aged care AiN $67,435 in retirement savings.

Employers “are licking their lips”

While these prominent members of the Liberal Party, along with sections of the financial media and business groups, argue a rise in super would lead to lower wages, other economists strongly disagree.

“The argument that if you just give up your super increase, you’ll get more in your pay packet, that’s utopian dreaming. What you will get instead is none of both,” says economist Jim Stanford from the Australia Institute.

He says that the sluggish growth in real wages over the past few years, even though there’s been no increase to super, shows the link doesn’t exist.

The share of profit enjoyed by business owners “has hit all-time records since 2017”, Stanford says.

“Because of the pandemic and how it’s shaped the labour market, I think employers are licking their lips at the prospect of both freezing and restricting wages and restricting super increases.

The Liberals’ “fraudulent argument”

The claim that the super increases are unaffordable has also been rubbished by former prime minister Kevin Rudd.

Rudd labelled it a “fraudulent argument” to claim the super rises would come at the expense of wages. He said wage increases “had been negligible” in the years before the COVID-19 pandemic.

“It has no statistical foundation, no logical foundation, no data to support it,” he said.

Experts point out that the scheduled increases are a third of the most recent increase in the minimum wage, and a sixth of the one before that.

Federal politicians have a 15.4 per cent government contribution into their parliamentary retirement accounts.

Work without end

Even though she has been nursing since she was 18 years old, RN (and acting CNC) Jacquie Myers still won’t have enough super to fully retire.

“I started work at 18 years old. I was in the public health sector, so I joined NSW State Super. But back in the 1980s, when I fell pregnant with my children, you could only come back to full-time work. I had to go to private sector work so I could work part-time while I was caring for children. State Super paid me out in 1983; I couldn’t leave my super in there because I wasn’t … in the public sector. They paid seven and a half years’ worth of super into my bank account. My husband was working in the Electricity Commission then, and he was on strike for eight months, and so we had to use that money to live and pay the mortgage and electricity. We had one baby and another one about to be born. We considered ourselves lucky that we got that seven and a half years’ super then. But if I had kept it in State Super, I would have a motza now. Kids today who are in this COVID world, I don’t blame them for dipping into their superannuation. I was in the same situation, and it isn’t fair.

I’m one of about 10 women in a group of friends where we all had our babies in the ’80s, and the only way you could work full-time and have children was to work nights. I didn’t go back to full-time work until my kids were in high school. We don’t have enough to retire on comfortably, so my plan now is that we [myself and my husband] will probably still continue to work part-time. My husband will work part-time as a bus driver and I will do agency work. My friends and I are supposed to be retiring, but we are all doing agency work to make life a little bit more comfortable.”