Changes proposed to stop early withdrawal of superannuation.

Treasurer Jim Chalmers announced further protections for Australia’s superannuation system to safeguard retirement savings in a speech on Monday. The government is looking to block the early release of retirement money, which amounted to around $36 billion during the pandemic, as it was an “unfortunate policy” of the former coalition government. In order to preserve retirement savings, they plan to enshrine the definition of superannuation into law. This definition is “The objective of super is to preserve savings to deliver income for a dignified retirement, alongside government support, in an equitable and sustainable way”. Additionally, the government is considering changes to super tax concessions and the consultation paper released on Monday states that the focus should be on delivering income, not minimizing tax on wealth accumulation or enabling retirees to leave tax-effective bequests. The Association of Superannuation Funds of Australia has welcomed this proposed objective as the “next chapter in the Australian superannuation story”, and CEO Martin Fahy believes it will ensure an affordable age pension, preserved superannuation savings, and an equitable system for women and low-income earners.