The Superannuation Budget 2023 delivers a range of important reforms focused on easing cost of living pressures, enhancing retirement outcomes, and supporting small business resilience. With changes to downsizer contribution eligibility, new incentives for older Australians, and business energy grants, the budget aims to balance fiscal responsibility with practical support.
Key Superannuation Measures
National Housing Accord
As part of the Superannuation Budget 2023, the government plans to work with super funds, state governments, and the construction sector to boost affordable housing. The goal is to direct long-term superannuation capital into new housing developments, creating more supply and easing pressure on the housing market.
Expanded Downsizer Contributions
Australians aged 55 and over will soon be eligible to make a one-off downsizer contribution of up to $300,000 into their super from the sale of their home. This helps older Australians free up larger homes for younger families, while boosting their retirement savings. The contribution is tax-free and does not count toward standard contribution caps. Both members of a couple can contribute, allowing up to $600,000 combined.
Superannuation Asset Protection Reminder
The government also issued a warning about certain schemes that claim to protect superannuation assets from creditors using trusts or mortgages. These arrangements are often unnecessary and may breach superannuation laws. It’s a reminder that superannuation is already legally protected and doesn’t need complex structuring.
Support for Pensioners and Older Australians
Incentives to Downsize Without Losing the Pension
Selling a family home won’t impact your pension immediately. From 2023, sale proceeds are exempt from the pension asset test for 24 months (previously 12). During this time, the money is also subject to a low income deeming rate of just 0.25%, helping pensioners keep more of their payments.
Boost to Work Bonus Limits
A temporary $4,000 top-up to the Work Bonus income bank gives pensioners more flexibility to work part-time or take on short-term roles without losing their benefits. In total, pensioners can now earn up to $11,800 in 2022–23 before their pension is reduced.
Expanded Access to the Commonwealth Seniors Health Card
The income limits have increased, meaning more self-funded retirees can now qualify. The new thresholds are $90,000 for singles and $144,000 combined for couples, providing access to cheaper prescriptions, bulk-billed doctor visits, and utility discounts.
Better Aged Care Funding
Funding includes:
- $2.5 billion for 24/7 nursing in aged care homes.
- New home care services under the Support at Home Program starting in July 2024.
- More skilled migrants to support the aged care workforce.
Families, Health and Living Costs
Cheaper Medicines
The cost of many common medications will be reduced thanks to $1.4 billion in new PBS listings and $787.1 million to lower medicine prices. This is especially helpful for people with chronic conditions who rely on regular prescriptions.
More Flexible Paid Parental Leave
From 1 July 2023, either parent can receive paid parental leave. Parents will also have the option to take the leave at the same time, making it easier to share caring duties.
Making Child Care More Affordable
Changes include higher subsidies for families earning less than $530,000, and guaranteed access to 36 subsidised care hours per fortnight for First Nations children, helping families participate in work or study.
Support for Small Business and Growth
Grants for Energy Efficiency Upgrades
Small and medium businesses can apply for grants to invest in more energy-efficient equipment. This will help lower power bills and reduce emissions, making businesses more competitive and sustainable.
Support for Mental Health and Financial Stress
The Small Business Debt Helpline and New Access mental health coaching program will receive $15.1 million in additional funding. These services help business owners manage stress, debt, and wellbeing.
Infrastructure and Industry Investment
- $120 billion pipeline for transport and infrastructure projects over 10 years.
- $50.5 million for a Critical Minerals Research Hub to drive innovation.
- $15 billion National Reconstruction Fund to support local manufacturing and critical industries.
Boosting Skills and Jobs
- 180,000 free TAFE places starting in 2023, with 480,000 in total over four years.
- 20,000 new government-supported university places for in-demand industries like health, teaching, and technology.
Australian Taxation Office (ATO) Measures
More Funding for Tax Compliance
The ATO’s Tax Avoidance Taskforce will receive an extra $200 million annually to pursue tax evasion and collect outstanding debts. This helps ensure that everyone pays their fair share and the system remains balanced.