Jamie Burnett:
That is one part of the puzzle that has been flagged by Adam Creighton. He’s a chief economist at the Institute of Public Affairs. Good day, Adam.
Adam Creighton:
Good afternoon, Jamie.
Jamie Burnett:
Why now for super reform?
Adam Creighton:
Well, look, we’re clearly in a cost of living crisis and it’s been established for many years that 9% was actually the appropriate rate. The government’s treasury has said that, left wing think tanks have said that, right wing think tanks have said that. So it’s very disappointing it went to 12. So my idea was why not let people go to their boss if they want and say, “Look, I’ll just have that 3% upfront. Thank you.” I mean, it’s no skin off the boss’s nose. They don’t really care where they send the money, whether it’s to a super fund or to the employee. And so why not give people the option at least? It’s not going to affect anyone else. And all the evidence suggests, as I put in that column in the Australian, that people are saving enough already, well enough. In fact, people are passing away with 90% of their super, actually, which is pretty extraordinary. So that’s the best-
Jamie Burnett:
We’re putting too much away for a rainy day, are we, Adam?
Adam Creighton:
Oh, yeah, yes, yeah, we certainly are. And look, when you think about it, your best years are in your 20s, 30s, 40s, and 50s when you’re raising family and you can still travel. So why not let people have a little bit more now when they need it or when they can use it and when they can enjoy It, than be super rich when they’re 75? Of course we need to save for retirement. Everyone knows that. But 12% is just simply too high. And look, if we’re being cynical, the reason it went to 12, is because the two most powerful vested interests in the country, the union movement and the banking sector, both get a lot of power and money out of it.
That’s the reality of it. I mean, the fees of super are $35 billion a year across the whole system. Now that’s not marked down as a tax, but it may as well be a tax. And just for your listeners, 35 billion is half the defence budget. So it’s a lot of money that’s going into the administration of all of these funds. And I just think people should have the option to have that 3% if they want. No one’s being forced to, just why not have the option?
Jamie Burnett:
So Adam, you don’t think it went from nine to 12% because we’re living longer, stresses on the pension, the bottom line of federal budgets, that kind of thing?
Adam Creighton:
No, well actually it costs the government far more to have super in net terms. A lot of people think that super saves the government money, but it actually doesn’t. It actually costs the money in net terms, because there’s a lot of tax concessions associated with super. And it actually doesn’t affect the number of people that get the pension all that much. I mean, even going right out many decades. So it’s not saving taxpayers money in the long run at all. That’s a common misconception. And it gets a bit technical, but I encourage the listeners to read my column if they want a bit more detail, but it doesn’t save the government money in the long term, and the 12% rate had nothing to do with added lifespan.
Jamie Burnett:
Almost impossible to say, right? But how many people, you reckon they might be feeling the pinch at the moment, could be in their 30s, 40s, couple of kids, mortgage, all of that. How many you reckon would lean into that and take up the offer of bringing 3% onto the bottom line today?
Adam Creighton:
Look, I don’t know. It’s a really interesting question, because there’s never been any surveys, but I imagine people on lower incomes, especially when they’re younger, would definitely take it up. I mean, especially renters and people just trying to get by, week to week. I mean, the last thing they’re thinking about is what they have when they’re 76. I mean, think of all the people that don’t even make 76. I mean, isn’t it better that they at least have the option to spend a bit more when they’re younger? So I would imagine, I mean, I don’t know, I’m just guessing, but I’d imagine a good third of people perhaps would elect to take, just bring it back to nine. And remember, it was at nine for a very long time, and it’s only gone to 12 because the labour government eventually legislated for it to go to 12. The Abbott government paused the increase for about five years, but they should have actually stopped it entirely. Unfortunately, they didn’t have the gut to do it because the reality is they’re scared of the extraordinary lobbying power of the super industry.
Jamie Burnett:
Yeah. Interesting, Adam. Do you reckon we’re going to see any change in this space? Anyone got the guts to have a crack?
Adam Creighton:
Well, look, I mean, Pauline Hanson has been speaking out about it, and so is Andrew Bragg, a liberal senator. Some politicians are starting to speak out about it. Look, do I think there’s going to be any fundamental change? Unfortunately, probably not. But if there is a significant One Nation presence in the next federal parliament, who knows? Who knows? Because if there’s any time to reform it, it’s now, because people are hurting.
Jamie Burnett:
All right. Hey, interesting one to pose. We’ll see what the listeners think. Good on you, Adam.
Adam Creighton:
Okay, thanks very much.
Jamie Burnett:
Adam Creighton there. What do you think about his idea?
This transcript with Adam Creighton talking on Drive with Jamie Burnett 6PR from 31 August 2026 has been edited for clarity.
