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Superannuation Reforms Pass Parliament

Media Releases

Date : 17 June 2021

Author: The Hon Josh Frydenberg MP & Senator the Hon Jane Hume

The Hon Josh Frydenberg MP

Treasurer

Senator the Hon Jane Hume

Minister for Superannuation, Financial Services and the Digital Economy

Minister for Women’s Economic Security

JOINT MEDIA RELEASE

17 June 2021

SUPERANNUATION REFORMS PASS PARLIAMENT – MAKING YOUR SUPER WORK HARDER FOR YOU

The Morrison Government has today passed through the parliament landmark reforms to Australia’s superannuation system. These reforms will help ensure superannuation works in the best financial interests of all Australians by removing unnecessary waste, increasingly accountability and transparency, and providing more flexibility for families and individuals.

The passage of the Treasury Laws Amendment (Your Future, Your Super) Bill 2021 will save Australians $17.9 billion over 10 years.

The passage of the Treasury Laws Amendment (Self Managed Superannuation Funds) Bill 2020 today will also increase the maximum number of allowable members in self-managed superannuation funds (SMSFs) and small APRA funds from four to six from 1 July 2021.

This will provide Australians with more flexibility and control in managing their retirement savings.

In addition, the passage of the Treasury Laws Amendment (More Flexible Superannuation) Bill 2020 will help boost the retirement savings of Australians by giving them more options to contribute to their superannuation.

The Bill extends the bring‑forward arrangements to people aged 65 and 66 for non-concessional contributions made on or after 1 July 2020. These changes complement previous actions by the Government to improve flexibility of the retirement system that allowed people aged 65 and 66 to make contributions without meeting the work test.

The Bill will cut red tape by removing the excess concessional contributions charge, which currently applies to contributions in excess of the concessional contributions cap. This will ensure that from
1 July 2022, Australians saving for their retirement are not financially disadvantaged by inadvertent breaches of the cap.

Australians will also be supported to make additional contributions to their superannuation to make up for amounts that they may have withdrawn due to COVID-19. From the 2021-22 financial year, individuals who released superannuation under the COVID-19 early release scheme will have the option of recontributing these amounts as non-concessional contributions, over and above the existing caps.

Together, these are the most significant reforms to superannuation since the introduction of compulsory superannuation in 1992 and build on the Government’s prior reforms which have included consolidating 3.3 million unintended multiple accounts worth $4.3 billion, capping fees on low balance accounts, banning exit fees and ensuring younger Australians do not pay unnecessary insurance premiums.

Through these measures, the Morrison Government will ensure the superannuation system works harder for all Australians by reducing waste, holding underperforming funds to account and strengthening protections around the retirement savings of millions of Australians.

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