Australia to require employers to pay pension benefits on payday
Australian employers will have to pay pension benefits at the same time as wages, the government said on Monday, in reforms designed to help boost retirement savings.
Employers must currently pay pension contributions at least four times a year, while wages are usually paid once or twice a month, a divergence that contributes to lower pension pots and unpaid benefits for employees, the statement said.
Government modelling forecast that simultaneous payments could leave a 25-year-old median income earner with around A$6,000 ($3,982) or 1.5% more in retirement.
Keep updated, follow The Business Standard's Google news channel
The reform will also set targets for the Australian Tax Office (ATO) to recover payments and flagged more resources for the agency. No figure for extra resources was provided in the announcement.
The ATO estimates A$3.4 billion worth of superannuation payments went unpaid in fiscal 2020.
Consultations on the changes will begin in the second half of the year.
($1 = 1.5067 Australian dollars)
