SMC welcomes Budget boost to make super safer, next tasks are to fix unpaid super and guarantee super to all young workers

The Super Members Council welcomes a $17.8 million Budget boost tonight to strengthen consumer safety in super following the devastating collapses of the Shield and First Guardian schemes - and urges the Government to move swiftly next to guarantee super for all young workers.

Tonight’s tax-reform framed Budget also reveals that the Australian Taxation Office has not yet set itself any performance targets for unpaid super recovery when game-changing payday super laws start on July 1.

Unpaid super currently costs 3.3 million working Aussies a shocking $5.7 billion a year – this is money they have earned and are legally owed by their employers. Yet the ATO has signalled it will only set a new performance target for unpaid super recovery when it has “sufficient data on which to determine a performance benchmark”.

“Overall, this is a steady as she goes budget for super, with a handful of modest but important new investments to boost oversight of investment schemes like those in the Shield and First Guardian collapses,” said Super Members Council CEO Misha Schubert.

“Further urgent reforms are needed to make super safer by strengthening consumer protections and transparency, including applying the super performance test on super platform products where millions of consumers are still flying blind on whether their super is performing for them or not.”

“It’s also crucial that the Government fast-track long-promised reforms to help Australians to get more safe guidance and advice from their own super fund – those tools are crucial to keep consumers safe from predatory social media clickbait ads like those that targeted the Shield and First Guardian victims.” 

“The new payday super laws from 1 July will mean that for the first time, the ATO will soon have real-time visibility on which workers have been unpaid or underpaid super every single pay cycle. The Government must set the ATO bold targets to swiftly recover that money owed to everyday working Australians.”

“It is also long past time to end an unfair, outdated and discriminatory exclusion of under-18 workers from being guaranteed super if they work less than 30 hours a week for the one employer. This will be a watershed moment for intergenerational equity.”

Ending the denial of guaranteed super for young workers and domestic workers such as cleaners and nannies who work in people’s homes would powerfully build on the Government’s reforms in recent budgets. Those earlier reforms include payday super laws, adding super to Commonwealth Paid Parental Leave, and boosting the Low-Income Super Tax Offset for 1.3 million low-paid workers from 1 July 2027.

In tonight’s Budget, the $17.8 million in new consumer safety funding will resource ASIC to strengthen governance requirements for managed investment schemes and use data to more closely supervise these schemes - and will be partially offset by cost recovery.

The Budget has also confirmed a shift to a “tell us once” approach to data reporting and affirmed further red tape busting reforms to streamline current duplication that costs consumers in super.

The centrepieces of the Budget included a new Working Australians Tax Offset for 13 million Australian wage earners, and sweeping reforms to negative gearing and capital gains taxes.