Is Compulsory Superannuation Actually Delivering for Australians?
Australia's $4.77 trillion super system is growing. But how much is reaching ordinary members? Benchmark examines retirement balances, investment performance, fees and tax concessions.
After 34 years of compulsory superannuation, Australia has accumulated an enormous retirement savings pool. But are ordinary Australians receiving sufficient benefits to justify the costs?
Australia's superannuation system held $4.77 trillion in assets at June 2026, an increase of 9.5% over twelve months. Annual employer and voluntary contributions to larger funds reached $236.3 billion.
Investment performance has been respectable. APRA reports an industry annual return of 8.6% in 2025–26 and a five-year annualised return of 6.3%.
There is also evidence of greater financial independence. ABS data show the proportion of retirees relying principally on superannuation increased from 20% in 2014–15 to 28% in 2024–25.
But aggregate wealth is not the same as individual retirement security.
The Unequal Outcomes
ATO data for 2023–24 show Australians aged 60–64 had a median superannuation balance of just $203,326.
Men held a median $236,126, compared with $174,655 for women — a 26% difference.
These balances provide useful retirement savings, but many Australians remain dependent on the Age Pension, particularly those without substantial assets outside superannuation.
The system also imposes substantial costs.
APRA reports $12.3 billion in fees during 2024–25, almost 90% paid by members.
Its 2026 performance test failed 12 of 547 products. More revealingly, a broader APRA assessment identified four MySuper products holding $81.3 billion with significantly poor ten-year investment performance.
What About Taxpayers?
Treasury estimates that concessional taxation of superannuation contributions and investment earnings represented approximately $60.7 billion in measured revenue forgone in 2025–26.
These estimates are not equivalent to revenue recoverable through abolishing concessions.
Nevertheless, the distribution raises questions.
Treasury found that 79% of the benefit from earnings tax concessions went to people with above-median incomes in 2022–23. The highest-income 10% received 38%.
There is another economic trade-off. Treasury's Retirement Income Review concluded that higher compulsory contributions tend to reduce wage growth, shifting income from working life into retirement.
The Verdict
Compulsory superannuation is delivering greater retirement savings and income for many Australians.
But success should not be judged by the industry's size.
The proper tests are retirement incomes after fees, the fairness of taxpayer subsidies, and whether members receive value from their compulsory contributions.
A $4.77 trillion industry should be judged by what it delivers to members, not by how much money it controls.