Financial abuse reforms welcome – now close the gaps in super
Super Consumers Australia welcomes the Government’s response to the Parliamentary Joint Committee (PJC) inquiry into financial abuse, but says stronger safeguards are needed across the superannuation system to protect victim-survivors from losing their retirement savings.
The Government has supported, or supported in principle, 58 of the inquiry’s 61 recommendations, signalling an important commitment to tackling financial abuse.
Super Consumers Australia’s Director of Advocacy, Lily Jiang said the announcement was a positive step towards addressing the devastating impacts of financial abuse.
“Everyone deserves financial independence and superannuation is often the largest asset a person has in their own name. Financial abuse in super not only robs people of that independence but also threatens their retirement future,” Ms Jiang said.
“We welcome today’s announcements and look forward to continuing to work with the Government to prevent and address financial abuse in superannuation. However, this requires safeguards at every level of the system.
“We need to address the risks built into the system, identify abuse before people’s savings are transferred, and make sure the professionals people rely on aren’t enabling that abuse.”
Super Consumers Australia is calling for stronger action by the Government to:
- Fix the loopholes in the system: adopt the PJC inquiry recommendation and conduct a comprehensive review of financial abuse in super, with a focus on self-managed super funds (SMSFs), informed by the lived experiences of victim-survivors.
- Prevent abuse at the point of transfer: require super funds to proactively identify warning signs of financial abuse and provide appropriate support to members.
- Hold intermediaries accountable: introduce mandatory minimum standards requiring all professionals involved in superannuation to identify red flags and prevent them from facilitating financial abuse.
“Once a person’s retirement savings have been transferred into an SMSF under coercion, the damage can be lifelong. That’s why prevention matters and why every level of the super system needs stronger safeguards,” Ms Jiang said.
“Victim-survivors shouldn’t have to navigate these risks alone or carry the burden of identifying and stopping financial abuse themselves.”