SMC backs proposal to close family violence super loophole

The Super Members Council (SMC) has thrown its support behind proposed legal changes aimed at preventing perpetrators of domestic and family violence from accessing their victim's superannuation.

Under existing super law, a family violence perpetrator can claim and be paid their victim's super even in cases involving clear, sustained abuse of their spouse or prior convictions for family violence. The only current legal deviation is where the perpetrator's actions are found to have directly caused the death. SMC argued this creates a serious gap in the system, allowing financial gain from harmful behaviour.

In a submission to Treasury, the group backed the introduction of a clear rule that would give super fund trustees the authority to withhold payments from perpetrators in cases involving family violence or unlawful killing. It also supported allowing trustees to consider evidence of abuse when deciding how death benefits are distributed, even if the abuse was not a direct cause of death.

SMC said empowering trustees to make these decisions would avoid forcing families into lengthy and costly court proceedings, which could further distress those affected.

SMC chief executive Misha Schubert said the current framework does not reflect community expectations or adequately protect members.

"It is fundamentally wrong that a perpetrator of domestic or family violence can still inherit their victim's super," Schubert said.

The proposed reforms would also need to extend across different types of super funds and payment structures to ensure consistency, SMC added. The submission also highlighted the need to include self-managed super funds, as well as more complex arrangements such as defined benefit schemes and reversionary pensions, where gaps in coverage could otherwise undermine the intent of the changes.

SMC also emphasised trustees would require clear legislative backing and guidance to apply the rules consistently and fairly, particularly in cases involving coercive control, elder abuse or long-term patterns of harm that may not be captured by existing legal thresholds.