Labor’s super sentiments

The Labor government recently marked 100 days in office. Here’s a quick look at what the government is thinking for super. 

Here are five key areas: 

• Your Future Your Super (YFYS) – This is a package of super reforms that came into effect on 1 July 2021. Aimed at improving the efficiency, transparency and accountability of the super industry overall, it’s what gave us the MySuper Performance Test, account stapling and the Best Financial Interest Duty reforms. All indications suggest that Labor is keen to review various aspects of these reforms. 
• Purpose of super – What is super for? To provide an income in retirement of course. It seems to be a basic question, but it is a truly important one. Defining the purpose of super in legislation, as per the new government’s pre-election commitment, will be crucial to making sure that future changes to super will explicitly consider the purpose of super as a part of the process.
• Super Guarantee – Not only is Labor interested in ‘investigating the pathway’ to lift the minimum SG rate from 12% (which is currently what the minimum SG rate will be from 1 July 2025) to 15% p.a., but it also intends to address the gender disparity at retirement, in particular by paying SG for people on parental leave (if the budget can allow for it). 
• Retirement income – New legislation passed recently called on Trustees of super funds to develop a formal Retirement Income Strategy for members nearing and in retirement to help them maximise their income, manage risks and have flexible access to their money. Keeping to the same theme, Labor has acknowledged the government’s role in addressing the lack of appetite for a variety of retirement income products that go further than account-based pensions. 
• Housing and climate – Labor has expressed an interest in addressing barriers to investing in affordable housing and climate transition. What’s the connection to super? It’s about investigating how super industry assets might be used to solve housing shortage and climate transition challenges through investments. 

It’s important to note that at this point in time, all this is at a discussion and deliberation stage with more details to be provided in the future. However, it’s quite possible that some of these will be taken up in the next Federal Budget, which will be held on 25 October 2022. Our experts will delve deeper into super-related budget proposals when the time comes, so it’s a space worth watching. 

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