We call those pension schemes...Superannuation.......
About 10years ago, the government of the day passed a law, that it was compulsory for ALL EMPLOYERS to contribute 9% of an employers gross wage to a Superannuation Scheme.
This was NOT taken out of the employers salary, but was an added 9% that companies had to contribute for every employer who earned over $300 per week. If the employee also wanted to conribute they could do so, any amount they wanted to.
These contributions are invested in interest bearing investment companies, and the employee gets the interest, less adminstration costs. Up until the last couple of years, people were getting very high interest and their superanuatio funds were rising rapidly, but over the past year or so, they have really dropped and some have even lost money.
It is only collectable on retirement, either in a lump sum or as an ongoing weekly income for the retiree.
The purpose of the government starting up this scheme, was to put in place a programme where retirees would be self funded, and not draw on the aged pension which is available here to all people of retirement age and is given out by the government. The aged pension is means tested, so if someone is getting an income from their superannuation fund, then they would not qualify for the aged pension. There are also tax incentives to save for retirement, and for money people put in a superannuation fund. People can have their own private "super fund" as long as it is regulated the same as the big ones.
As you can imagine, there are trillions of dollars in varying super funds, and some people who have changed jobs have money in several funds, which they can combine if they wish to. Many people who have had lots of different jobs, actually lose track of where their super money has gone. Accounts are sent out once a year, but they also can still not find the owner if they have changed address, which so often happens.
From our view as a small business when we owned the pet shop, we found having to find another 9% of any wages we paid, and send it off to a superanuuaton fund, was an expense that was quite overbearing. Considering the fact that at one time we had a 19 year old working for us, who we had to contribute $50 a week for, which was not going to be able to be collected by him for another 50 odd years.
There are millions and millions of dollars that will probably never be collected....and that is just not right.
On the other hand, there will also be much that is collected, and so there will be less paid out by the governement in old age pensions, over the next decades.