Legislating the objective of superannuation
The Superannuation Committee of the Law Council of Australia’s Legal Practice Section (the Committee) provided a submission to the Treasury in response to ‘Legislating the objective of superannuation’.
Given that the proposed objective of superannuation would not represent a legally binding constraint on its intended audience (i.e. Parliament), it is unnecessary to introduce the objective by way of legislation.
Since it is not intended to operate as a law, it is not necessary to implement the objective via law reform. A non-statutory solution would be preferable, since that would also avoid numerous possible unintended consequences such as those outlined below.
However, if the objective of superannuation is to be legislated notwithstanding these concerns, then there are good reasons (outlined below) why:
- stand-alone legislation should be utilised (rather than incorporating the objective into existing superannuation legislation);
- sensible provisions should be included in the same legislation to clarify how the so-called ‘yardstick’ should be applied in assessing future superannuation reforms and by whom (for example, what sort of compatibility with the objective would be required and whether all or only some components of the objective need to be fulfilled); and
- certain words (such as ‘equitable’ and ‘sustainable’) should either be avoided, replaced with synonyms that do not compete with trust law concepts, and/or clearly defined and limited in their application.
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