Hundreds of thousands of Australians have been ‘ripped off’ by bosses who’ve neglected to pay them their super entitlements or opted not to comply with their legal obligations. But that’s about to change.
Hundreds of thousands of Australians have been intentionally or unintentionally ‘ripped off’ by bosses who’ve either neglected to pay their employees their superannuation entitlements or have opted not to comply with their legal obligations.
However, changes are coming on July 1 that will mean the chances of employees being dispossessed of their rightful payments will be a lot harder.
On that date, employers will have to pay their employees’ super when they make their regular wage payments. Right now, super has to be paid quarterly on the 28th day of the month that follows the end of a quarter.
This has been a concession especially to small businesses that seemed fair, given that super has been both a wage cost and administration cost for employers that was created by former Treasurer Paul Keating, with Prime Minister Bob Hawke’s approval in 1992. However, business owners in financial trouble or those who have shoddy accounting affairs have often failed to make these compulsory super payments for their employees, which is now 12% of their annual pay.
To understand how this superannuation obligation has been ignored by too many employers and too many previous governments, the Daily Telegraph reports: “Fresh figures released by Cbus Superannuation found nearly 30,000 construction workers under 35 had missed out on or had delayed super payments last financial year”.
As this has been a huge problem, the Albanese Government deserves praise for this initiative, given that on average 2.8 million workers (or 17% of the workforce miss out on being paid some or all of their entitlements). In 2022-23, the number was a whopping 3.3 million, totalling $5.7 billion!
In that year in NSW, over 1 million workers were ‘robbed’ of their super. Nationally, 1.3 million women had their super underpaid, while young workers, especially in the construction sector, copped a super rip off.
While many of these law-breaking employers don’t pay up because of financial difficulties or poor business processes, the fact that super payments were made quarterly was a cash flow bonus for a good business but a potential problem for an operation already in trouble.
Our super system is hailed as one of the best preparations for retirement in the world, with nearly 80% coverage of the working age population. APRA has recently revealed super information and when you look at the magnitude of these numbers in the table below, you’ll see its importance.
| – | September 2024 | September 2025 | Change |
|---|---|---|---|
| Total superannuation assets | $4,082.3 billion | $4,466.5 billion | +9.4% |
| Total APRA-regulated assets | $2,829.7 billion | $3,151.5 billion | +11.4% |
| Total self-managed super fund assets | $1,023.7 billion | $1,073.4 billion | +4.8% |
| Exempt public sector superannuation schemes assets | $171.6 billion | $181.4 billion | +5.7% |
| Balance of life office statutory fund assets | $57.3 billion | $60.2 billion | +5.1% |
And the next table shows the magnitude of the annual contributions.
| – | September 2024 | September 2025 | Change |
|---|---|---|---|
| Total contributions | $191.3 billion | $215.6 billion | +12.7% |
| Total benefit payments | $120.9 billion | $136.2 billion | +12.7% |
| Net contribution flows* | $66.0 billion | $71.3 billion | +8.1% |
*Net contribution flows comprise of contributions plus net benefit transfers, less benefit payments
While I’m a great fan of super, given that it is 12% of an employee’s pay packet, it does make saving for a deposit on a home very difficult. While many baby boomers have low super balances because compulsory super only started in 1992 and it began at a much lower percentage of income, they have been ‘saved’ by the failure of successive governments to help increase the supply of housing, which has led to high house prices.
There’s a strong argument that those without properties should be able to borrow from their own super, as real estate assets are good for overall future wealth. However, all governments — federal and state — have to help add to the supply of homes.
In Victoria, we can see why the supply of housing has problems. To pay the $34.5 billion price for the first stage of the rail tunnel called the Suburban Rail Loop East (which will link Cheltenham to Box Hill), the Allan Government plans to slug developers $33,000 per dwelling built in the areas serviced by new rail service.
Considering the obstacles placed in front of developers who create homes, it’s no wonder our supply is so bad that house prices keep going through the roof.
Until all governments get real and sensible about helping boost the supply of properties, real estate will look like a better investment than super to ordinary Australians.
As a financial planner, while I want my clients to have both super and property, the latter is becoming out of reach for many young Australians. And things could get worse after the May Budget. If changes to the capital gains tax discount is introduced, many Australians who can’t afford to buy a property as a residential homeowner, have started on the real estate ladder by becoming an investor. This has tax advantages and many of these investors later move into their investment property when their wages are higher and/or their kids are at school, meaning two full-time jobs are more possible.
We’re desperately in need of governments committed to really solving this housing supply and price problem. Clearly, allowing access to super to buy property without any decent increase in supply would lead to higher prices, which isn’t needed, given the surge in home prices.
For the record, the average value of homes has risen 560% since the year 2000. By the end of 2025, the combined capital city average house value reached $1.18 million. And you can ‘thank’ or ‘condemn’ Australian governments for this unbelievable spike in house prices.
