Pausing the superannuation guarantee (SG) charge at its current 9.5% and allowing a third tranche of the superannuation hardship early release scheme have emerged as two possibilities for inclusion in the Federal Budget.
The two possibilities were canvassed during a web debate between NSW Liberal Senator, Andrew Bragg, and Victoria Labor backbencher, Dr Daniel Mulino, with the question being asked in the context of the Assistant Minister for Superannuation and Financial Services, Senator Jane Hume, having referred to the popularity of the early release scheme.
Asked his opinion of the early release scheme during the Association of Superannuation Funds of Australia (ASFA) debate, Bragg described it as having been “proportionate and popular” with it having been used in the majority of cases to pay down debt or mortgages.
However, when asked whether an extension of the scheme was likely to be included in next month’s Federal Budget, Bragg referenced his relatively lowly status as a backbencher.
However, he said he was open-minded on the question.
For his part, Mulino said he believed that the Government’s policy approach had been hasty and ill-directed and had resulted in people using their personal superannuation savings to fund something which should have been the responsibility of the Government.
“In doing so, the Government has taken away the benefit of a lifetime of compound interest – that is a short-sighted approach,” Mulino said.