Finance Minister rules out changes to Super Guarantee increases

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The Minister for Finance has ruled out changes to the timetable for Superannuation Guarantee increases, something which the PM and other senior Ministers have refused to do.

A senior member of the Government has ruled out slower increases to the Super Guarantee rate, following growing speculation that backbenchers will drive the Coalition to stop or further slow increases to the legislated rate.

In Senate Question Time, Labor Shadow Minister for Finance Senator Katy Gallagher asked her counterpart, Mathias Cormann: “Minister, can you rule out any changes to the timetable for the legislated increases to the Superannuation Guarantee, as they are contained in the Superannuation Guarantee (Administration) Act 1992?”

The answer was very short: “Yes.”

Update: During Question Time in the House of Representatives on Wednesday, Treasurer Josh Frydenberg joined the Finance Minister in ruling out changes to the timetable for Super Guarantee rate increases, with a likewise short answer of “Yes” to a question from Labor. Previously he’d repeated the answer of having “no plans” to change the timetable.

PM less committal, Treasurer: “No plans”

Meanwhile in the House of Representatives, Prime Minister Scott Morrison was less committal.

Labor Shadow Treasurer Jim Chalmers asked: “Does he agree with seven of his backbenchers, who want to ditch the legislated increase of the Superannuation Guarantee to 12%?”

“There’s no change to the Government’s policy,” was the full answer given by the PM.

The Australian this morning reported growing calls from the backbench to stop increases to the SG rate, and possibly use a potential review of retirement incomes to build a case against the legislated increases.

In another question, the Shadow Treasurer pointed to comments by the Trade Minister, quoting him as saying: “It’s not the Government’s intentions or plans to change what’s legislated at this point in time.”

When asked to rule out “any changes” to the legislated increases to the SG rate, the PM again answered that there was no change to the Government’s policy.

In a later statement, Chalmers accused Morrison of using “weasel words”.

“The test for Scott Morrison today was to stand up to the extremists on his backbench and rule out thieving workers’ super, and he failed dismally,” Chalmers said.

“The Liberals are clearly gearing up for another attack on the retirement incomes of Australian workers.”

“At a time when workers’ wages are stagnant, the Liberals also want less money going into their retirement balances as well.”

When asked recently about potential changes to the legislated increases, the Treasurer Josh Frydenberg has said the Government has “no plans” to do so.

The Superannuation Guarantee was set to already be 12%, under legislation passed by Labor. But under the Coalition the increases were paused and delayed, with the Super Guarantee rate now scheduled to reach 12% in 2025.

Delays to increases in the Superannuation Guarantee rate

Stopping SG rate increases would be a broken promise: ISA

Industry Super Australia (ISA) warned that heeding the “ginger group” of backbenchers would leave Australians worse off at retirement.

ISA said denying workers an increase in their super contributions would be a broken promise from the Government.

ISA Deputy Chief Executive Matthew Linden said: “Australians would be right to ask why these Federal MPs think it’s ok to leave the super guarantee at just 9.5 percent when they are beneficiaries of contributions of at least 15.4 percent under the parliamentary super scheme.”

“Winding back the super guarantee would leave Australians worse off at retirement and increase the burden on the age pension. It’s bad policy and the Government should rule it out.”

“The last thing working Australians need is a contrived case to delay the super guarantee increase, or to freeze it altogether. The Government made a promise and they should keep it.”

More to come.

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