19.1 Superannuation, as a form of long-term saving for retirement, serves an important role and, for many Australians, is one of the most significant forms of wealth.[1] As Australia’s population ages, successive governments have introduced measures to maintain and enhance superannuation savings, largely through compulsory superannuation membership and contribution and preferential tax treatment.[2]

19.2 In this chapter the ALRC examines ways in which the Australian superannuation system does, or could, respond to protect those people experiencing family violence. The ALRC makes a number of recommendations, but in doing so acknowledges the specific role that superannuation plays as a long-term form of savings and recognises the policy tension between the need to preserve superannuation benefits until retirement and the need, in limited circumstances, to allow early access to superannuation funds.

19.3 This chapter consists of two main parts. The first part deals with circumstances in which a victim of family violence may have been coerced into taking action in respect of their superannuation. It considers spousal contributions and self-managed superannuation funds (SMSFs). The ALRC concludes that the treatment of superannuation should be considered in the context of a wider inquiry into how family violence should be dealt with in respect of property proceedings under the Family Law Act 1975 (Cth). The ALRC also makes a number of suggestions with respect to compliance action taken in relation to SMSFs and recommends changes to guidance material with respect to establishing, managing and winding up a SMSF.

19.4 The second part of the chapter examines circumstances in which a victim of family violence may wish to seek early access to superannuation benefits, for example, for the purposes of leaving a violent relationship. In considering early release on the basis of severe financial hardship, the ALRC recommends amendments to the eligibility requirements for making an application and to guidance material for decision makers in granting early release. The ALRC also considers early release of superannuation on compassionate grounds and makes recommendations in relation to guidance material and training for decision makers.

[1] Australian Government, ‘Stronger Super’: Government Response to the Super System Review (2010), 3.

[2] By 2050, almost one in four Australians will have reached retirement age, compared to one in seven in 2010: Ibid.