Speaking at the Superannuation Lending Roundtable hosted by The Australian Financial Review this week, Treasurer Jim Chalmers proposed several sweeping reforms that could shake up the $3.4 trillion superannuation sector.
Vowing not to mess with the fundamentals of the superannuation system, Mr Chalmers said the Labor government will instead “dispassionately” diagnose the challenges, and work at addressing them.
“We won’t be directing funds into asset classes or looking for new excuses to give members early access – that was a disaster in my view,” Mr Chalmers said, taking a veiled swipe at the former government, which at the height of the pandemic, allowed Aussies to withdraw significant funds from their super.
To ensure this doesn’t happen again, the Treasurer said his government will shortly legislate a primary objective of the superannuation system.
Labor has previously voiced its intention to cement super’s purpose in law. Just last year, the then opposition financial services and superannuation spokesman, Stephen Jones, said, “The purpose of super is to provide a secure dignified retirement – not to fix every other area of this government’s policy neglect.”
But the new government doesn’t plan to stop there, with Mr Chalmers also vowing to tackle the burning issue of gender disparities in retirement balances, assuring that his government will “fund the super guarantee on paid parental leave when the budget circumstances permit”.
Moreover, he said, “we will catch up and keep up with global regulatory developments here so there’s some consistency and transparency for investors like you”, adding that “work is well underway on the disclosure of climate risk and opportunities”.
“We are told that will make it easier for you to invest in the transition,” Mr Chalmers noted.
Moreover, recognising and responding to the shortage of housing, the Treasurer hinted that his government will put more pressure on super to up its involvement in residential housing.
“Can we work to package up enough like‑projects to deliver scale, do we require some kind of availability payment to make it worthwhile, in addition to the bond aggregators and the like, or are there other better ways?” Mr Chalmers questioned.
The Treasurer confirmed he is “thinking about” putting together a Treasurer’s investor roundtable, which would bring together super funds and other institutions like banks, venture capital funds, and the like to “nut out the opportunities in areas like energy and housing, perhaps impact investing as well, and iron out the difficulties”.
Input would also be sought towards mapping out the “best place” for the government’s own co‑investment funds – for energy transmission, clean energy, housing, advanced manufacturing and supply chains, northern Australia – and the Future Fund.
“Like our discussions today, it would be a genuine attempt to treat super’s potential for common ground, not another battlefield.”
