Next year, the superannuation contribution guarantee (SG) scheme will turn 20. And Smart Investing is getting in very early to mark this momentous occasion for Australian superannuation.

The great achievement of the SG scheme has been to extend superannuation coverage to the vast majority of the employed workforce.

Certainly, there are still considerable gaps in superannuation coverage among working Australians - principally the self-employed who have not made their own super arrangements.

Certainly superannuation savings are still, on average, grossly inadequate, as starkly pointed out in the Superannuation Savings Gap report, compiled by Rice Warner Actuaries for the Financial Services Council. (The latest report was published in October last year.

The inadequacy of women's average super savings remains a burning issue. And a tremendous challenge for Government and the financial services industry (including super funds and financial planners) is to convince today's fund members that SG contributions alone are insufficient to provide a sufficient retirement income - even taking the age pension into account.  

The ABS reports that the average super balance in 2007 of fund members aged 55-64 years - in other words, those in the final decade before retirement or on the eve of retirement - was only $142,000.

When the SG celebrates its 40th birthday in 2032, most fund members retiring around that time would have had SG cover for their entire working lives.

And the SG scheme combined with the rapid ageing of the population means that post-retirement super savings would have greatly expanded.

It's interesting that Rice Warner's latest Superannuation Market Projections report forecasts that the market share of post-retirement super assets held by industry funds will rise from 5.2% today to 21.5% within 15 years.

This point regarding industry funds is highlighted here because industry funds, of course, have been tremendous beneficiaries of both award super (introduced in 1986) and the SG system six years later. Award super had triggered a tremendous spurt in super coverage among the Australian workforce.

A growing proportion of industry fund members are nearing or in retirement - much depending upon a fund's membership demographics.

As the SG scheme continues to mature with the ageing of the population, there will be increasing focus on the provision of retirement incomes. Expect this to be one of the key issues for discussion in 2011 and beyond.