IQ Group is always on the lookout for what might change in the future. For the most part, superannuation was not a major talking point during the election. That all changed with the Liberal announcement of their Super Home Buyer Scheme. As the final results are still coming in, we pause to consider the ‘super horizon’ under a Labor Government.
Already on the road (for 1 July)
The following measures, legislated under the previous government, are not going to be changed by Labor:
- SG increase to 10.5% (with continual increases to 12% in 2025);
- scrapping of the $450 per month wage threshold;
- downsizer contribution minimum age drop from 65 to 60, as a measure to increase housing stock for families (Labor will also legislate to drop this further to age 55 in line with election promises); and
- removal of the work test for those aged 67 to 74 years (inclusive).
Labor election promises to be implemented:
- extend eligibility for the senior card (matched Coalition promise);
- freeze pension deeming rates (matched Coalition promise); and
- review benchmarking tests of the Your Future Your Super performance assessment.
On the horizon
The Labor government may also consider:
- super for paid parental leave (not likely for a while yet as Labor currently cites budgetary repair concerns as a reason);
- improved access and fairness of the superannuation structure for women; and
- various protections around eligibility, unpaid superannuation benefits and contractual arrangements (that perhaps fall more into the industrial relations bucket but have an impact on the super industry).
- Liberal’s announcement of a Super Home Buyer Scheme allowing first home buyers to invest up to 40% of their super (up to a maximum of $50,000) – criticised by Labor during the election. Labor had an alternate policy to promote home ownership that did not involve superannuation.
We are yet to see how the independents and other parties will influence (or not influence) the superannuation landscape under a Labor Government. However, given super has not been a significant focus during the election, its horizon looks relatively unchanged.
The industry will continue to undergo significant mergers and acquisitions and be challenged to implement the many legislative changes post the Royal Commission. However, it may just be able to take a pause, and be given a little more time to focus on consolidation of existing processes, remediation and operational efficiency rather than continued legislative change.
IQ Group look forward to continuing to support and advise our many superannuation clients on the journey ahead and making sure that the super horizon is a bright one .. for the industry and, most importantly, the millions of members that it serves.
By David Atcheson, IQ Consultant