SMC pushes to close ‘deeply troubling’ super loophole

In December 2024, the Parliamentary Joint Committee on Corporations and Financial Services reported to parliament on the financial services regulatory framework in relation to financial abuse, which SMC said helped build strong momentum in the lead-up to the public consultation and collective advocacy across the super system.

“Under existing laws, a perpetrator can claim a spouse or partner’s super death benefits unless their actions are found to be the direct cause of that person’s death, even where there is clear evidence of abuse,” the council said.

“This currently applies even if the perpetrator has been convicted of family violence offences, or in cases when there was systemic abuse which indirectly contributed to the cause of the victim’s death,” it added. 

Setting robust standards

The government encouraged submissions from family and domestic violence organisations, frontline support workers, the superannuation sector, and the wider community.

SMC noted that closing this loophole was part of its 12 key policy priorities, which the council asked all parties and independents to support to strengthen and safeguard people’s superannuation.

The council proposed further avenues for reform, including expanding the forfeiture rule to family violence-related crimes, preventing perpetrators from inheriting their victim’s super, and looking into legislative reforms that would allow super funds to withhold death benefits in substantiated cases of family violence.

“Clear and robust evidence standards, judged by an independent body such as a court, would ensure procedural fairness and due process,” it said.

“It’s part of our commitment to building a safer Australia, where women and children can live free from violence,” it added.

Minister for Social Services, Tanya Plibersek, stressed the role of superannuation in providing people with security and dignity in retirement.

“If someone who has been the victim of family or domestic violence dies, their tormentor shouldn’t benefit financially from that,” she said.

“This is another important step towards delivering our election commitment to close loopholes and prevent financial abuse in Commonwealth systems.”

“This is part of our work to close opportunities for financial abuse. Perpetrators of family or domestic violence should be punished, not rewarded for their actions,” added Daniel Mulino, Assistant Treasurer and Minister for Financial Services.

SMC chief executive Misha Schubert said that amid a deeply troubling loophole in Australia’s system, this was a long-overdue reform.

“We look forward to working with Government, regulators and family violence experts to help deliver reforms that are strong, practical and fair, while providing trustees with clear legal certainty to act in the best interests of members,” Schubert said.

Public consultation submissions close on 15 April 2026.