The Government has released the consultation draft of the remake the existing super co-contribution regulations, Superannuation (Government Co‑contribution for Low Income Earners) Regulations 2004 (2004 regulations), which are due to sunset on 1 April, 2022.
The draft would aim to improve the 2004 Regulations by omitting redundant provisions, simplifying language and restructuring provisions for ease of navigation.
The only substantive changes in the draft regulations would be:
- Amending the definition of an eligible account to receive super co-contribution payments so that it excludes those which only provide terminal medical condition benefits in addition to the existing exclusion on accounts which provide only death or incapacity benefits. This change was consistent with the intention that the super co-contribution payment not be paid to insurance only accounts, where the contribution would subsidise the payment of insurance premiums rather than contribute to increasing an individual’s retirement savings; and
- Clarifying the operation of section 7 relating to where a Government co‑contribution is to be directed in specific circumstances. The draft regulations ensured that only one item would apply in the event of multiple circumstances being applicable.
Consultation on the draft regulations would be open for a four‑week period and submissions could be made until 14 January, 2022.