Superannuation experts are warning that your retirement nest egg could be at risk unless Australia commits to net zero carbon emissions by 2050.
As the rest of developed world gets on with the complex but critical task of reducing global carbon emissions, Australia appears stubbornly opposed to joining the party. This is despite the country being under threat from a rising average temperature.
Australia’s biggest financial institutions are setting their own climate-related investment goals, independent of government policy, and making moves to get their money out of high polluting fossil fuel industries such as coal and gas.
Superannuation experts say that without firm emissions targets to encourage divestment from fossil fuels, the retirement savings of millions of older Aussies could be under threat.
Read: Push to position retirees at forefront of climate change fight
With other nations around the world investing heavily in green technologies, Australia risks being left behind and missing out on big super returns.
Martin Fahy, chief executive of the Association of Super Funds of Australia (ASFA), says: “In the absence of a commitment to net zero greenhouse emissions by 2050, the superannuation industry stands to lose billions of dollars in investment returns on behalf of their members, which ultimately translates to fewer retirement savings.”
AFSA says that not only could you be missing out on big returns in future, but that government policy that ignores the financial risks of climate change – such as increased extreme weather events – jeopardises the existing super balances of Australians.
In a new discussion paper, AFSA is calling on the federal government to set a firm target of net zero emissions by 2050, ahead of the UN Climate Change Conference of the Parties (COP26) to be held in Glasgow in November.
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International pressure has been mounting on Australia to take more meaningful action on climate change before the Glasgow summit.
US President Joe Biden and UK Prime Minister Boris Johnson have both stressed the need for firm climate targets to the Australian government.
But to date, the federal government continues to resist any firm goals on Australia’s net zero commitments, insisting that any negative impact on jobs or the economy is unacceptable.
Read: Wondering if your energy company takes climate change seriously?
“Our plan will set out how we’ll get there [net zero emissions], not just why we’ll get there and when we get there, it’s the how that matters, because it’s the how that determines what the costs are, how we protect jobs, how we ensure that the Australian economy remains strong into the future,” Prime Minister Scott Morrison told Brisbane radio station 4BC.
“I want to keep those jobs in rural and regional Australia. We’re going to get there through technology, not higher taxes. That can absolutely be achieved and we can do the right thing by future generations.”
Should the government be committing to net zero by 2050? If not, are you okay with your retirement balance suffering as a result? Let us know in the comments section below.
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