Bad Choices are No Real Choice – Protecting Strong Defaults and Informed Choice

Submission by the Australian Council of Trade Unions to Senate Economics Legislation Committee Inquiry into the Treasury Laws Amendment (Supporting Choice in Superannuation and Other Measures) Bill 2025

The objective of superannuation is to preserve savings to deliver income for a dignified retirement, alongside government support, in an equitable and sustainable way for all workers. This must be the benchmark against which all policy settings – including choice, defaults, onboarding and stapling – are assessed.

Australia’s superannuation system delivers its strongest retirement outcomes when it combines:

• High-quality default funds, selected through informed industrial processes which are focused on members’ industrial and occupational needs and which prioritise members’ long-term outcomes including through returning all profits to members.
• Genuine, informed choice supported by clear information and education.
• Appropriate insurance, aligned to the risks workers face in their chosen industry and occupation.

Policies that weaken default arrangements, distort choice architecture, or undermine access to appropriate insurance, are inconsistent with the legislated objective of superannuation and will lead to worse retirement outcomes, particularly for women, lower paid workers and those in insecure or high-risk employment.

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