In December 2017, the Government commenced a review into early release of superannuation on severe financial hardship and compassionate grounds. As part of this process it sought views on whether a perpetrator’s superannuation should be available to meet unpaid victims of crime compensation orders. Background.
The Government has released a consultation paper containing two draft proposals that would provide victims of crime with access to a perpetrator’s superannuation in certain circumstances.
Broader issues relating to early release on compassionate and severe financial hardship grounds will be progressed through a separate process.
The first draft proposal aims to prevent criminals from using superannuation to shield assets from victims of crime. It would allow victims of crime to claw back ‘out of character’ contributions. This would be achieved by amending the current early release provisions to require trustees to pay amounts into court in response to a claw-back order (either directly to court or through some mechanism to centralise and streamline release and payment). The first draft proposal would only apply to particular contributions rather than the perpetrator’s entire superannuation balance.
The second draft proposal would allow victims of serious crimes with unpaid compensation orders to access a perpetrator’s entire superannuation balance (not just particular contributions) where other assets have been exhausted. This draft proposal is based on the principle that the interests of uncompensated or partially compensated victims of crime should be prioritised over the retirement income needs of the perpetrator. This draft proposal also includes safeguards to protect the interests of dependants of a perpetrator.