To Protect Australian Workers’ Retirement Savings, We Must Democratize Pensions
The Australian right has long dreamed of fully privatizing workers’ pensions. Now that one of the world’s largest investment firms is moving into Australia’s superannuation market, their dream may be realized. To protect workers’ retirement, we need to democratize super funds.
Financial corporations and right-wing politicians will continue to transfer workers’ funds to private management companies unless the Left can make the pension system democratic and egalitarian. (JOEL CARRETT/AFP via Getty Images)
Australia’s retirement savings scheme — known as superannuation, or super for short — is worth nearly $3 trillion. It is a product of the labor reforms brought about during the Bob Hawke and Paul Keating era. Super requires employers to pay a percentage of wages as contributions toward their employees’ retirement savings.
“Industry funds” linked with trade unions manage just under one-third of super funds. A board of representatives, half of whose members come from unions, control these funds, which are the fastest-growing and best-performing part of the pension system.
This tells you why the Australian right has always hated super. For employers, lowering superannuation contributions would mean a lower wage bill. For finance capital, disempowering industry funds would give them access to billions of dollars in workers’ savings by limiting union involvement in capital markets.
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