Tevita Kofutu’a has plans for the $10,000 in superannuation he earned over five years of seasonal work in Australia.
He’ll use it to buy a vehicle and pay a deposit on some land in Tonga where he and his wife Fine want to raise a family.
But nearly 10 months after he returned home, he’s still waiting for the money.
Kofutu’a said the couple were told her husband’s superannuation claim was lost after Tonga’s Ministry of Internal Affairs posted his application to his fund.
After mailing another application last month, frustration is mounting for the couple, who live on an outer island of Tonga where internet access is scarce.
“This is getting out of control,” Kofutu’a said.
“When we come back, all these obligations pile up and that superannuation could have helped a lot.”
Pacific Island workers coming home from Australia to other parts of the region say it’s a long and complicated process to get their superannuation.
Labour mobility and aid experts say there are language barriers and a lack of awareness about super among some workers.
High taxes, fees and remitting costs, and limited internet access and administrative support are other obstacles.
And they appear to be stopping many workers from claiming their money.
“There are a lot of workers who have indicated that they have accumulated significant unclaimed super,” Alisi Holani, labour mobility expert at regional economic body PACER Plus Implementation Unit, said.
The Australian Taxation Office (ATO) holds more than $1 billion (US$674 million) in unclaimed superannuation owed to former temporary residents, including Pacific Australia Labour Mobility (PALM) workers.
Australia’s Department of Foreign Affairs and Trade estimates that on average, short-term PALM scheme workers are likely to accumulate about $3,800 (US$2,561) in superannuation through a nine-month placement.
But many work for longer and Jessica Collins, a Pacific aid expert at the Lowy Institute, said unclaimed super could be up to $15,000 (US$1,110) for some individual workers — a year’s salary back in the Pacific, she said.
“Not enough people really understand the enormity of the problem for the Pacific workers,” Dr Collins said.
“This is their hard-earned money.
“If you can [claim it], then that can make a huge difference to the schools that your kids can go through, and to being able to see your doctor and go to hospital.
“Cost of living is really high in the Pacific right now, they’ve got a lot of imported inflation. But they’re also still really struggling to bounce back economically from the pandemic.
“So every dollar counts.”
At a PACER Plus meeting last year, Pacific Island representatives raised their concerns about the barriers for returned PALM workers claiming their superannuation.
Experts say a system used by New Zealand to send workers’ savings to Pacific Island funds could point to a solution.
And some have questioned a 35-45 per cent tax on the superannuation paid to Pacific workers — money that could go far back on their home islands.
Ni-Vanuatu woman Karine Waniel, a former seasonal worker in Victoria, is using her superannuation to build a shop on her home island of Malekula.
With her paperwork ready for her claim, it took her three months to get her payment.
She said the wait is long for other ni-Vanuatu returning from Australia.
“Each one of us has different backgrounds. Some of us understand the process, and some don’t,” she said.
Waniel hopes the process can become simpler and easier for PALM workers.
“They work hard [in Australia] and then when they come back they work hard again to get access to the money that belongs to them.”
Witnol Benkor, who has a business in the capital Port Vila helping returned ni-Vanuatu workers claim superannuation, said many were unaware of what to do.
“There’s a lot of administration process in regards to the superannuation,” he said.
PALM workers have to wait until their visa is no longer active before applying.
They need copies of bank statements, and for claims above $5,000(US$3,370), they may need certified copies of ID and a certification of immigration status from Australia’s Department of Home Affairs.
The documents can be hard to access if workers have closed their Australian bank accounts, their passports have expired, or they’ve returned to outer islands that lack internet.
“[That] also consumes a lot of time. It needs a lot of paperwork and commitment to meet the criteria for the fund to be released,” Benkor said.
“It’s challenging for them.”
Dr Collins said workers can also be charged a fee by the superannuation company for an Australian bank deposit rather than an Australian dollar cheque, which can’t easily be banked in the Pacific.
Workers then have to pay high remittance costs to transfer their superannuation from an Australian bank account to the Pacific.
Dr Holani from PACER Plus said PALM workers needed more information.
“And also understanding that for a lot of these workers, English is not their first language. And a lot of them might not be internet savvy or computer literate,” she said.
“This was something that from the discussions we had, that we could potentially easily address.
“But it requires effective cooperation between the Pacific countries and Australia to provide targeted support that meets the needs of the workers.”
The Australian government announced in last year’s budget that it would increase support for PALM workers to access their superannuation savings.
A Department of Foreign Affairs and Trade spokesperson said the ATO was receiving more resources to provide outreach, training and support for workers preparing their superannuation claim while still in Australia.
“This will make it easier to lodge their Departing Australia Superannuation Payment [DASP] claim when they return home,” the spokesperson said.
Dr Collins also questions the 35-45 percent tax rate PALM workers pay when they finally receive their superannuation.
She said the tax was small fry for the government, but a huge loss to the Pacific’s development and could be used to feed families.
A Treasury spokesperson said the payments are taxed to recover tax concessions on superannuation paid to workers.
“This is in recognition of the fact that the individual will not be using their superannuation benefit for its intended purpose of providing an income for their retirement in Australia,” the spokesperson said.
Experts also say New Zealand could offer a model — although one limited by the country’s lack of mandatory superannuation.
Since 2020, its Recognised Seasonal Employers (RSE) workers have been able to elect for part of their income to be sent home to their accounts with Pacific Island national provident funds as savings.
The money, deducted from after-tax income, is not taxed again before it goes overseas.
Dr Holani said the savings would also help national provident funds invest more in development projects in the Pacific Islands.
Pacific countries have expressed interest in making PALM worker superannuation easier to transfer between Australian funds and their national provident funds.
But Australia only has such arrangements with New Zealand, partly due to the nations’ close economic ties, and establishing them with Pacific Island nations would require regulatory and legislative change.
Dr Collins said it would take political will and understanding to help PALM workers receive more of their superannuation. “The money that [PALM workers] can earn puts more food on their table. These are families that are doing it really tough,” Dr Collins said.