Moves from the Morrison Government to amend the Protecting Your Super (PYS) reforms to allow for the aggregation of members’ interests in one or more products held within a super account, and to ensure the rights of members under fixed term insurance cover aren’t affected and cover isn’t inappropriately removed, have been welcomed by the superannuation industry.
The Association of Superannuation Funds of Australia (ASFA) said that the changes would strike a “sensible balance” between protecting low balance accounts and retaining the investment and insurance benefits of the superannuation system.
“These pragmatic changes align the legislation with consumers’ understanding of their superannuation and reflect how people typically manage their superannuation affairs,” ASFA deputy chief executive, Glen McCrea, said, noting that the changes addressed concerns the industry had raised with the practical implementation of the reforms.
“They also make the legislation less costly and simpler to administer, promoting system efficiency,” he added.
At the same time, ASFA also praised the positive impact of downsizer contributions on retirement incomes, following Assistant Treasurer, Michael Sukkar, releasing figures showing that contributions had reached the $1 billion mark since the downsizer policy commenced on 1 July, last year.
“ASFA supported the Downsizer measure as a means of making it easier for retirees who sell their family home to invest in their super to secure a comfortable retirement,” McCrea said. “We are encouraged to see Australians use the measure to improve flexibility and living standards in retirement.”
The downsizer measures meant that retirees could make a non-concessional contribution into their super of up to $300,000 from the proceeds of selling their home, on top of the contributions already allowed under existing caps.