The ABC’s Fact Check website was launched in August last year on a mission to determine ‘the accuracy of claims by politicians, public figures, advocacy groups and institutions engaged in the public debate.’ But when it comes to the most important policy questions it is not necessarily the facts that are in question, but their interpretation.
This has been demonstrated by the federal government’s recent move to delay increases in the Superannuation Guarantee (SG) rate.
The SG rate freeze means the percentage of gross wages that must be put into super will remain at 9.5% rather than being increased to 12% by 2019-20. The Prime Minister has asserted that no-one would be worse off as this money would be put back into take-home pay; a claim that Fact Check determined to be ‘Incorrect’. This is an oversimplification.
The most literal interpretation of what the PM said — that every single worker will receive an increase in take-home pay equal to the proposed SG rate increases-may not be universally true. However, the economics of how the SG rate freeze will impact take-home pay are extremely complex. For most workers, the claim that ‘money that would otherwise be squirrelled away in superannuation funds will instead be in the pockets of the workers of Australia’ is right.
On the topic of the SG rate freeze it is not the government that is misleading the public, it is the super funds.
The super funds’ estimates of the cost to workers of the SG rate freeze ignore any increase in take-home pay that would result. Their claim that voluntary super contributions do not receive the same concessional tax treatment as the compulsory contributions mandated by the SG rate is also not true.
Workers are free to make voluntary super contributions, before tax, above the SG rate. These are taxed at the same concessional 15% tax rate provided that total (before tax) contributions do not exceed $30,000 a year (for those under 50). This is known as “salary sacrifice”.
While Fact Check has exposed some of the most egregious examples of misinformation with an appeal to official statistics, on this occasion it has inadvertently perpetuated the super fund’s tax myth.
This is not to suggest political bias on the part of the ABC. In this instance the subject matter is complex and the outcomes uncertain. What this underlines is that Fact Check best serves the public when it sticks to claims made by those who have quite clearly sought to mislead and scrutinises claims that can be verified by a direct appeal to the facts.
Matthew Taylor is a research fellow at The Centre for Independent Studies.
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The truth about fact checkers
This has been demonstrated by the federal government’s recent move to delay increases in the Superannuation Guarantee (SG) rate.
The SG rate freeze means the percentage of gross wages that must be put into super will remain at 9.5% rather than being increased to 12% by 2019-20. The Prime Minister has asserted that no-one would be worse off as this money would be put back into take-home pay; a claim that Fact Check determined to be ‘Incorrect’. This is an oversimplification.
The most literal interpretation of what the PM said — that every single worker will receive an increase in take-home pay equal to the proposed SG rate increases-may not be universally true. However, the economics of how the SG rate freeze will impact take-home pay are extremely complex. For most workers, the claim that ‘money that would otherwise be squirrelled away in superannuation funds will instead be in the pockets of the workers of Australia’ is right.
On the topic of the SG rate freeze it is not the government that is misleading the public, it is the super funds.
The super funds’ estimates of the cost to workers of the SG rate freeze ignore any increase in take-home pay that would result. Their claim that voluntary super contributions do not receive the same concessional tax treatment as the compulsory contributions mandated by the SG rate is also not true.
Workers are free to make voluntary super contributions, before tax, above the SG rate. These are taxed at the same concessional 15% tax rate provided that total (before tax) contributions do not exceed $30,000 a year (for those under 50). This is known as “salary sacrifice”.
While Fact Check has exposed some of the most egregious examples of misinformation with an appeal to official statistics, on this occasion it has inadvertently perpetuated the super fund’s tax myth.
This is not to suggest political bias on the part of the ABC. In this instance the subject matter is complex and the outcomes uncertain. What this underlines is that Fact Check best serves the public when it sticks to claims made by those who have quite clearly sought to mislead and scrutinises claims that can be verified by a direct appeal to the facts.
Matthew Taylor is a research fellow at The Centre for Independent Studies.
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