Super’s objective should be enshrined in law this week
09 September 2024
The Super Members Council urges all Senators to swiftly pass the landmark Superannuation Objective Bill.
This legislation, listed for debate in the Senate this week, will be a guiding light for future policy development in superannuation and deliver certainty and predictability for all Australians who rely on super for a better quality of life in retirement.
Super has delivered transformative benefits for millions of Australians. While the Australian public know super’s job is to deliver income for their retirement, its purpose has never been legislated in 32 years.
Super Members Council CEO Misha Schubert said the objective’s wording reflects the views of everyday Australians – and urged its smooth passage as recommended by a cross-party Senate committee.
“Ask everyday Australians what super is for, and they’ll tell you it’s their money for retirement,” Ms Schubert said.
“The ‘Objective of Super’ legislation reflects that clear and compelling purpose in ironclad law. It will be a guiding light for all future super policy development.”
“We strongly support the legislation. It will ensure super stays strong and secure – and continues to deliver a financially secure retirement for millions of everyday Australians, including today’s retirees.”
“An agreed objective of super supports more stable, effective and equitable policy settings and reinforces the strong system fundamentals needed to successfully evolve the system.”
The legislation says super’s role is to preserve savings to provide income in retirement in an equitable and sustainable way.
Importantly, the Superannuation Objective Bill safeguards super’s preservation policy – the principle that the clear purpose of super is to deliver retirement income – in law.
“The goal of legislating an Objective of Super has long held bipartisan and cross-party support – and we urge the Senate to pass this important piece of legislation this sitting fortnight,” Ms Schubert added.
The Financial Systems Inquiry in 2014 and the Retirement Income Review in 2020 both identified a pressing need for a clear objective in legislation. Both major political parties have committed to legislating an objective of super. The Senate legislative committee recommended the Bill pass.
The Super Members Council strongly supports passage of the legislation – and proposes three practical amendments the Senate could add to further strengthen the Bill:
- include robust modelling and data analysis in the statement of compatibility;
- make the statement of compatibility transparent and part of public consultation; and
- add a review every five years to make sure the objective is working as intended.