Malcolm Turnbull has an op-ed in Business Spectator in which he claims that:
there is evidence that increased compulsory contributions in Australia have largely been offset by falls in other forms of private saving, and by the public cost of the tax concession – leaving national saving little changed.
He doesn’t enlighten us as to what this evidence might be.
This 2004 RBA discussion paper does not support his claim. The researchers constructed a model to evaluate the ‘counterfactual’ savings rate, ie. the proportion of income that households would have devoted to private savings if compulsory superannuation had not been in place. The authors conclude:
We then estimated a saving equation for Australia to gauge how much of the compulsory superannuation has – on average – been offset by reductions in other saving. We estimate that around 38 cents of each dollar in superannuation contributions are offset, or in other words, 62 cents in each dollar are saved additionally. We use these estimates to construct a counterfactual saving rate, which suggests that compulsory superannuation may have increased the household saving rate by up to 2 per cent in recent years. Overall, our results suggest that government policies encouraging superannuation have added to both household saving and wealth.
One of the authors updated these findings in 2007 and found:
Australia’s pension accounts increased household wealth, with an extra dollar in their compulsory pension accounts adding between 70 and 90 cents to household wealth.
So, the RBA researchers found that most of the money that has flowed into superannuation contributions represents a net addition to private savings, over and above the savings that would have occurred in the absence of compulsory super. Maybe you could argue that the proportion of super that is offset by falls in other forms of saving will rise if the Superannuation Guarantee rate rises from 9% to 12%, but Turnbull does not make this argument. Instead, his claim is about what has already occurred.