PensionReforms' summary and comments
It is unsurprising to find that a person's current level of retirement savings is directly connected to things that are themselves unrelated to the retirement savings need.  This 2007 report from Australia (based on 2002 data) reinforces the point even in the presence of a compulsory, Tier 2 retirement savings scheme.

The report starts with a summary of the development of Australia's retirement saving (called, locally 'superannuation') arrangements over the last 30+ years.  For example:
"In 1974, only 15% of female employees were members of a superannuation scheme, compared to 41% of men."

Some of the differences were attributable directly to discrimination, something that was outlawed from 1984.  Superannuation schemes were, however exempt from compliance until the mid-1990s.

Even now, after 18 years of full compulsion, ".there is evidence that some employers simply do not make the contributions which they should be making.  The workers who are most vulnerable in this respect are those on the fringes of the labor market - people in low-paid and unskilled jobs, people in casual and part-time positions, people in jobs with high turnover (typically young people working in the hospitality industry), and migrants: that is, people who may be unaware of their rights or reluctant to complain for fear of losing their jobs.  It seems likely that females would be over-represented in this group, although of course it is difficult to obtain reliable statistics on non-compliance."

Members of the Tier 2 'SG scheme' can make voluntary contributions but only 30.4% of males and 21.4% of females today, despite income-tested incentives from taxpayers for the lower paid and 'stay-at-home wives'.

Having children reduces the family's wages (especially for women) and the pay-related contributions to Tier 2.  Also, the presence of children opens potential access to a range of income-tested benefits that encourage the suppression of declared incomes.

"Average superannuation savings for women are much lower than those for men.  However, the discrepancy cannot be entirely explained by the traditional female role in child care.  Even after controlling for a range of variables, including age, number of children, education, birthplace, and marital status, women have on average $10,858 less superannuation than men.  It is to be expected that a major part of this residual effect of being a female may be attributed to the cumulative effects of women's past and continuing disadvantage in the labour market both in terms of pay levels and access to higher ranking jobs associated with larger superannuation contributions as corroborated by the second model.  However when one controls for the gross income from wages and salaries in 2001-02, the disadvantage of being a female is more than double that figure.  Both women's incomes and their superannuation contributions were lower in proportion to men's in the past, and a control based only on current income is unable to capture this effect."

The report uses data from Wave 2 of the Household Income and Labour Dynamics in Australia (HILDA) Survey to see whether retirement saving by women and men vary according to the numbers of children they have.

"The results show that for women there is a clear inverse relationship between the value of superannuation and the number of children they have.  Moreover the inverse relationship between a woman's value of superannuation and her number of children persists after controlling for an extensive range of variables which may affect both her number of children and her superannuation."

For men, there are lower retirement savings where there is one child but that does not change with increasing numbers, as is the case for women.

That's not the only thing that affects retirement saving levels:
"The analysis also shows that level of education, migrant status, being an employer or self employed, marital status, age and sex are significantly related to an individuals' level of superannuation."

PensionReforms thinks this is all much as might be expected.  The report's recommendation is vintage Tier 2 territory.  Given all the rules that are needed to run a Tier 2 scheme, the 'solution' to the gaps identified is obvious - more rules; or rather targeted payments such as ".a government-paid superannuation contribution to the lower paid parent in families which receive child-related benefits."

In fact, since the report's data was produced, the 'co-contribution' system has been introduced and that has been 'good' for low paid women, but they have to be in work to collect the government's subsidy.  The report suggests that the work requirement "seems counterproductive".

The report thinks that greater superannuation savings are necessarily better than less.  Also that individual entitlements are more significant than household savings.  Finally, there is no recognition of anything other than Tier 2 savings as contributing to the financial security of retired Australians.  These all point to gaps in the report's analysis.   File size 228 KB; 35 pp)  367