Newspaper icon
The latest issue of Financial Standard now available as an e-newspaper
READ NOW

Senate Committee endorses Superannuation Objective Bill

The Senate Economics Legislation Committee has recommended the passage of the Superannuation (Objective) Bill 2023, marking its likely enactment.

The Committee urged Parliament to prioritise passing the bill in a report released last week because of the "overwhelming support" it received.

The Committee noted widespread calls from the superannuation sector for legislation to clearly define super's objective, which would bridge an understanding gap that has led to policy uncertainty, misguided proposals, and reduced retirement savings, ultimately placing a greater burden on taxpayers.

"The Objective of Superannuation will importantly benefit and support superannuation members, and support policymakers to make decisions that deliver good outcomes for super members," the Committee said.

It also strongly believes that a legislated objective will serve as a guide for policymakers, the public, and Parliament on the superannuation system's crucial role in preserving, growing, and delivering retirement income.

"The Committee considers that the Bill as drafted will create a clear framework for assessing future superannuation policy initiatives and support a superannuation system aimed at improving Australians' retirement incomes," it said.

Over half of the feedback received supported the Bill's intent and urged for its immediate passage.

For instance, Aware Super argued that passing the Bill would support the superannuation system's "effectiveness and stability" and contribute to public trust and confidence.

AustralianSuper asserted the Bill would promote intergenerational fairness, ensuring young people don't experience higher tax obligations to fund the Age Pension.

The Australian Council of Trade Unions (ACTU) praised the Bill for enshrining "fundamental principles" of superannuation, ensuring it benefits workers.

However, some feedback questioned the Bill's impact, suggesting it wouldn't shield super from future policy changes.

"For most low-income earners, if we're trying to support a minimum standard of living, it's really going to be done via the Age Pension, rent assistance and other supports," the Grattan Institute argued.

The Coalition also criticised the Bill as "not urgent, non-binding, and a distraction" from the pressing cost of living issues that Australians currently face, however, it will not oppose the legislation.

Read more: SuperannuationAge PensionSenate Economics Legislation CommitteeAustralian Council of Trade UnionsACTUAustralianSuperAware SuperGrattan InstituteCoalition