Coalition’s Policy on Super Balances – best super proposal for 20 years (almost)!

SUPERCentral News does not normally cover Opposition legislative bills (as they are not in Government and their bills usually go nowhere), however, we must make an exception for Senator Hume’s “Tackling the Gender Super Gap” Bill.

If enacted, this Bill would be the best change to Super in almost 20 years (since at least 2007). The full name of the Bill is “Superannuation Legislation Amendment (Tackling the Gender Super Gap) Bill, 2025” and the Bill was introduced into the Senate on 4 September 2025.

In general terms, the Bill will allow married couples to transfer all or a portion of their super balance from, say George, who has the higher super balance, to his wife, Mildred, who has a lower super balance, in order to increase Mildred’s super balance. This transfer can be undertaken once every 12 months and only while Mildred is under age 65. Additionally, the amount transferred must not cause Mildred’s super balance to exceed the general transfer cap (which is currently $2m).

If George’s and Mildred’s super balances in their SMSF are currently $2.8m and $400,000 respectively, George could transfer from his super balance up to $1.6m to Mildred’s super balance.  Their super balances would be as follows:

In this example, the maximum amount George can transfer is $1,600,000 being the difference between the general transfer balance of $2m and Mildred’s pre-transfer balance of $400,000. The maximum amount which could be transferred is referred to in the Bill as “the spousal redistribution limit.”

George could have chosen to transfer less than the maximum amount – say $850,000 so that his total super balance post transfer would be $1,950,000 and Mildred’s total super balance would be $1,250,000.

The amount transferred will be treated as a superannuation transfer rather than as a superannuation contribution. Consequently, in the SMSF context at least, there would be no tax arising on the transfer and the transfer will not be counted as a contribution so there will be no contribution cap issues.

This proposal will allow the high super balance spouse (usually the male) to increase the super balance of their spouse (usually the female) thereby reducing the gender super balance gap – hence the title of the Bill.

Additionally, it will also remove marital status discrimination from the Super System in that a divorced couple can split their super on a 50% / 50% basis but a married couple currently cannot.

While Senator Hume’s proposal was developed in the context of Division 296 Version 1.0, it can also apply to Division 296 Version 2.0.