Understanding the retirement and superannuation policies shaping the next federal election
As Australians prepare to head to the polls, one key issue remains top of mind for many—retirement. Whether you’re approaching retirement, already retired, or in the early stages of planning, the outcome of the upcoming federal election could directly influence your financial future.
Each political party brings its own agenda, and while election promises can shift, understanding their potential impact is critical for making informed financial decisions. Here’s what you need to know.
1. Superannuation Contributions and Taxation
The Coalition (Liberal/National)
The Coalition has typically focused on preserving the current superannuation tax concessions, supporting voluntary contributions, and limiting major reforms that could disrupt investor confidence. Expect policies that favour self-funded retirees and SMSF flexibility.
Potential impact:
- Continued incentives for concessional and non-concessional contributions
- Stability in super rules, which helps long-term planning
The Australian Labor Party (ALP)
Labor has previously proposed reducing tax concessions for high-income earners and reviewing the stage 3 tax cuts, which could affect how much after-tax income individuals have to contribute to super. They are also focused on strengthening the integrity and performance of super funds.
Potential impact:
- Possible tighter limits on tax concessions for high balances
- Stronger oversight of fund performance, benefiting members in underperforming funds
2. Aged Pension and Retirement Income
The Coalition
Likely to continue means-testing and promoting self-reliance in retirement through the Age Pension and Retirement Income Covenant. Recent policies have included expanding eligibility for home equity release via the Pension Loans Scheme.
Potential impact:
- Limited changes to Age Pension eligibility
- Incentives to use home equity as a retirement funding source
Labor
Labor tends to support a more generous social safety net and may review eligibility criteria for certain government payments. They are also advocates for increasing aged care support and funding.
Potential impact:
- Potential for increased Age Pension or support measures for lower-income retirees
- Greater integration between retirement planning and aged care funding
3. Superannuation for Women and Lower-Income Workers
Both major parties
There is growing momentum for paying superannuation on Paid Parental Leave (PPL), an issue historically supported by Labor and now being discussed more broadly. Addressing the gender super gap has become a bipartisan concern.
Potential impact:
- Improved retirement outcomes for women
- Potential new super entitlements during parental leave, especially for younger families
4. Housing Policy and Retirement
Many Australians rely on property as a key pillar of retirement wealth. While not always a retirement policy directly, housing affordability, downsizing incentives, and negative gearing reforms can all influence retirement strategy.
- Coalition: Incentives for downsizing and home equity release
- Labor: Potential reforms to negative gearing and capital gains tax concessions (though more moderate in recent platforms)
Potential impact:
- Strategy shifts for those planning to sell or retain investment properties
- Impacts on retirement income streams drawn from rental returns or sale proceeds
What Should You Do?
While it’s impossible to predict the exact outcome of the election—or which policies will be passed—what is certain is the need for a flexible, forward-looking financial plan. Here’s what we recommend:
Stay informed: Keep track of proposed policy changes as the election approaches.
Review your retirement plan: Ensure your super contributions, investment strategy, and pension planning remain aligned with your goals.
Talk to a professional: A qualified financial planner can help interpret policy changes and adjust your plan accordingly.
Disclaimer
This article is general in nature and does not constitute personal financial advice. It has been prepared without taking into account your individual objectives, financial situation or needs. Before acting on any information contained in this article, you should consider whether it is appropriate for your circumstances and seek professional advice from a licensed financial adviser. While every effort has been made to ensure the accuracy of the information at the time of publication, no guarantee is given as to its accuracy or completeness. Financial Framework will not be held responsible for any loss, damage, or consequence arising from any decision made based on the information provided.
