The alternative to upping interest rates that would leave us with more cash
Raising compulsory super could do the same job as raising interest rates — but the money is yours. So why aren't we talking about it?
The Reserve Bank of Australia (RBA) maintained the cash rate unchanged, leaving many Australians to wonder about alternative methods to combat inflation without burdening borrowers. While some economists suggest that raising the superannuation guarantee could be an effective solution, it would require legislative changes. The super guarantee, currently fixed at 12 percent, could be temporarily increased during periods of high inflation, providing households with more money for retirement savings instead of paying higher mortgage interest.
This approach would distribute the cost of fighting inflation among wage earners, who form the largest portion of the population with compulsory super contributions. Critics argue that this shift would merely transfer costs to another group, but supporters contend that it could help ease the burden on borrowers, particularly younger Australians with large mortgages.
Written by urgent.news from SBS News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
