With the games of the 31st Olympiad having closed in Rio, the games are about to begin when Federal parliament resumes on 30 August. As the Treasurer, Scott Morrison travels the country drumming up support amongst his backbenchers for the Coalition’s proposed super changes (announced in the Federal Budget), we have now seen the Labor Party provide their response to these superannuation measures.
Having ‘banked’ the $6 billion of tax savings themselves throughout the election campaign, this response by Labor is important to help determine its passage through both houses of Parliament. From the announcement yesterday, it doesn’t look like it will be all plain sailing. Labor has indicated that it will oppose some of the key measures that would introduce improved flexibility into superannuation, whilst at the same time addressing the retrospective approach taken by the Coalition to the lifetime non-concessional contribution cap.
I have included a summary below of the super policy measures announced in the Federal Budget and the Labor Party’s position:
It would appear that the Coalition are in no mood for accepting these amendments being proposed by the Labor Party, leaving open the need for negotiation with the Greens and independents in the Senate to see these proposed super changes become law.
Where to from here?
Much of the focus in Labor’s policy response is to support their ‘rank and file’ support base, which at the same time take the Government to task on the retrospective nature of the lifetime NCC cap. This needed to come at a cost though given the savings banked by Labor – this has resulted in a lowering of the Division 293 tax threshold and not proceeding with the improved flexibility conditions to contribute to super. The Coalition argues that removing these proposed measures around flexibility to contribute undermines the very people (within Labor’s support base) who need it most – those with broken work patterns (e.g. mum’s return to work, carers), and even those in small business.
I guess the debate on these proposed super changes will continue to rage for some time, with the battle lines only just appearing to have been drawn…. Let the games begin!