‍The Finsider is our blog series providing insights into the Australian financial services landscape. We interview experts who will share their perspectives on ideas and issues facing the financial industry today and in the future.

Our special guest for this month is Mary Delahunty. Mary joined ASFA this year as CEO. She has a strong track record in the superannuation and financial services industries, including over 10 years at HESTA in roles including head of impact, and general manager – business development and policy. In 2022 she founded Seven Advisory which provides specialist ESG and impact advisory services to institutional investors developing their social license to deliver long-term value. She was also previously an executive with Link Market Services. Mary is a member of the Pensions & Investment World Pension Summit International Advisory Board and holds several board positions including in the regtech and education sectors. She was a 2015 Churchill Fellow awarded for international research on gender equity in retirement outcomes. Mary studied Arts at the University of Melbourne, and later completed a Graduate Diploma of Financial Planning and then a Masters of Applied Finance.

What do you think is the most important issue facing the superannuation industry today?

Australia’s superannuation system is remarkable; it’s the envy of the modern world.  Its success is built on the fundamental pillars of preservation, universality, and equity.

Preserving people’s nest eggs in an increasingly complex world comes with a responsibility to protect the system from cybercrime and scams. Super funds are seeing a steady increase in both the volume and sophistication of attempts to gain access to Australians’ data and retirement savings. This risk isn’t unique to super. But given the scale of assets in the superannuation system, the potential consequences of a successful cyber breach of a super fund are uniquely far-reaching.

ASFA is doing extensive work developing and helping to implement practical measures — over and above existing legal requirements — to improve funds’ cybersecurity and resilience and to ensure members are protected.

It has been proposed that people can access their super to buy a home.  What would you say to young people who can't afford to purchase a house and who feel that retirement is too far away to think about?

Young Australians are in a unique set of generational circumstances. Millennials are arguably the first generation in our history to be worse off economically than their parents. It’s difficult to reassure young people that the Australian Dream is alive and that it’s worth saving for a brighter future. In that context, “obvious” ideas like early access to super can seem tempting — until you realise they wouldn’t work.

ASFA’s research shows that early release of super for housing won’t actually benefit the first homebuyers who need help. Instead, it will worsen intergenerational inequality and provide substantial tax benefits for high-income earners, with only limited benefits for low-income earners.

We know 50% of renters have less than $30,000 in their superannuation, much less than the approximately $120,000 deposit needed for a house purchase.  

More effective policies are needed to improve housing supply and the overall economic outlook for younger Australians. Early release of super seems like an easy option, but it isn’t an effective policy; it won’t lift homeownership rates and will not solve the barrier-to-entry challenge of housing deposits for first-home buyers.  

What do you see as the role of ASFA in the current environment and how has this changed in recent years?

ASFA’s role has been constant throughout its history. We advocate for the entire superannuation community, we educate its professionals, and we collaborate with our members to help Australians retire in dignity and financial security.

We also engage in advocacy to uphold and progress the key pillars of superannuation, including measures to support preservation, improve equity, and ensure system sustainability.

Our recent advocacy priorities have included raising the Low-Income Super Tax Offset (LISTO) to ensure lower-paid Australians receive more in their super account, superannuation on paid parental leave, and payday super to ensure all Australians are getting their super contributions regularly. We estimate that changing super contributions from quarterly to fortnightly will improve the retirement savings of a 25-year-old median income earner by $6,000.

What is one change you would like to see happen in superannuation in the next 12 months?

Lifting the upper threshold for LISTO from $37,000 in annual income to $45,000 will have far-reaching positive consequences for Australians struggling with the rising cost of living. It will mean recipients have up to $700 extra in their super accounts each year. For a person aged 35 earning $44,000 a year, a $700 annual LISTO payment would lift their super balance from around $293,000 to $336,000 by the time they retire at 67. That’s a significant difference and would benefit approximately half a million Australians.

What advice would you give to those starting out their careers in the financial services industry?

Remember that as financial services professionals, we “serve” by definition. The work of super professionals, advisers, bankers, insurance professionals and others has a wide-ranging impact on people’s lives — and even the lives of the next generation. A service-oriented practice is not only a guide for ethical action; it’s a vital motivator on tough days!

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