SMSF Association Submission
The SMSF Association welcomes the opportunity to make a pre-budget submission for the 2019-20 Federal Budget. As leaders of the SMSF sector, we believe we are able to offer insights on some key issues from the perspective of an industry that has grown to represent approximately $755 billion in assets and over 1.1 million SMSF members, becoming an integral part of Australia’s superannuation system and economy.
This year our submission focuses primarily on improving the simplicity of the superannuation system and better defining its purpose for the benefit of all Australians.
We submit to the Government that it is now an opportune time to look to define the objective and role of superannuation. Given dynamic policy landscape driven by the Productivity Commission’s review of superannuation and the Financial Services Royal Commission, ensuring that superannuation has a clear objective will help drive meaningful and effective holistic policy change.
The SMSF Association also continues to believe that the current contribution caps are inadequate, particularly for Australians approaching retirement age. Restrictive caps do not incentivise individuals to save for their retirement during the years in which making larger contributions to superannuation is financially possible.
We also propose that a spousal rollover measure be introduced for superannuation fund members. This measure will provide an effective and efficient way to significantly improve the superannuation retirement gap between genders and improve equalisation between couples, particularly for women. It also potentially makes the superannuation system simpler as less members will need to comply with exceeding the transfer balance cap.
The need to ensure SMSF advisors have undertaken specific SMSF advice education is now supported by both the Australian Securities and Investment Commission and the Productivity Commission. We believe raising the standards of SMSF advice through specific education requirements is essential for the provision of quality SMSF advice to trustees.
Moreover, our submission highlights significant complexity issues impeding the superannuation system. The restrictions facing SMSF members who reside outside of Australia and a host of technical amendments, including an amnesty for legacy pensions, resulting from the introduction of the new super reforms are proposed fixes to smooth implementation, and provide further choice, flexibility and simplicity in the superannuation system.