Australian Superannuation System

The assets of superannuation funds have increased rapidly in the 1990s. Along with managed funds more generally, this growth has been considerably faster than the growth of assets of financial intermediaries. And the Australian superannuation fund assets have increased on average by 15 % a year over the past 10 years until 2007. It is equivalent to approximately 100 per cent of the value of Australia's annual Gross Domestic Product. While, the increasing trend stoped in 2008. In last financial year, total estimated superannuation assets decreased by 7.6 per cent in December 2008 quarter to $ 1.05 trillion.

As we are normal human beings, everyone will become old in one day. We may lose our ability to working. Therefore, the superannuation fund assets are created. It is a way of saving money to provide benefits for our retirement.

In the early 1980s, superannuation funds covered less than half of the workforce and existed mainly in the public sector and among large private sector employers. In recognition of the need to encourage individuals to provide for their retirement, from 1986 employer-provided superannuation benefits were introduced into industrial award arrangements.

In July 1992 the Superannuation Guarantee took effect, which, combined with the introduction of superannuation in awards, led to a marked increase in the membership of superannuation schemes. Prior to the inclusion of superannuation in industrial award agreements in 1986, only 47% of full-time employees were covered by super-annuation. In 1988, 64% of men working full time were covered, increasing to 86% by 1995. For women in full-time employment the growth in coverage was even more dramatic, from 47% in 1988 (substantially below that for men) to 89% in 1995. Those in part-time employment (particularly women) also improved their position over this period.(The Australia super website )

Superannuation coverage; sex by age and labour force status, Australia 1988 and 1995 (%)

Diagram 1:

Coverage of male population Coverage of female population

1988 1995 1988 1995

Labour force status

Employed full time 63.5 85.5 46.8 88.8

Employed part time 20.4 47.8 19.0 66.1

Unemployed 3.2 4.3 2.2 4.5

Not in labour force 1.8 2.4 1.5 3.1

Age

15 - 44 52.6 70.5 24.0 55.0

45 - 64 50.4 60.2 16.8 41.9

65 - 74 2.4 3.2 0.2 1.3

Superannuation is a retirement scheme in Australia. Most people begin saving super when they start work. Every employers are required