$740m in latest super solution for young workers

More than 365,000 West Australians are paying excess fees and getting little value out of duplicate superannuation accounts, according to Federal Treasurer Josh Frydenberg.

He said they could, collectively, bank $740 million by consolidating accounts.

Amid a renewed push to get Labor to back superannuation laws allowing the tax office to automatically consolidate low-balance duplicate accounts, Mr Frydenberg said the reforms would deliver a big boost to the super savings of West Australians, particularly the young.

Data released by the Australian Taxation Office shows that more than 365,000 West Australians hold duplicate accounts, with at least one having a balance less than $6000.

Duplicate accounts — mostly created when workers do not nominate a preferred fund when starting a new job — were identified in a Productivity Commission report as one of the biggest barriers to accumulating retirement savings.

The report said workers were being ripped off $3.8 billion a year by extra accounts and poorly performing funds.

Mr Frydenberg again demanded that Labor support the Government’s reforms.

The Treasurer said consolidating accounts would add $690 million — or an average $1890 each in the first year of the new laws — to active accounts. Banning account exit fees and capping excessive account fees could save about $50 million in the first year of the policy.

Shadow treasurer Chris Bowen has said the coalition had refused to bring its legislation on for a vote, or negotiate details of the laws.