Create the life you want
Updated Government Response
Government on the march
On Sunday 23 March, Scott Morrison announced the second round of stimulus measures targeted at combating the impact of the coronavirus. Valued at $66billion, this package brings the Government reported overall economic assistance package to $189 billion. They simultaneously increased the self-isolation measures and enforcement of social distancing, with the clear objective being to reduce the speed of spreading of COVID-19 (“flattening the curve”), whilst supporting the sustainability of businesses, impacted individuals and the broader economy.
Over the longer term we expect these actions will support the recovery in our markets and the rebound we are expecting in your portfolios over the medium and longer term. Over the short term, we cannot confidently predict what impact these stimulus packages will have, other than that we do expect there will be more to come as the contagion increases over the next month or so.
Some super changes
In the recent assistance measures, changes to superannuation where announced that may impact on you, namely:
- The minimum superannuation pension payment percentage for 2019/20 and 2020/21 will be re-set to half the normal rates for these years.
- Eligible individuals will be able to access up to $10,000 of their superannuation before 1 July 2020 and another $10,000 after that date.
To be eligible you need to be:
- Unemployed or receiving Job Seeker Payment (previously known as Newstart Allowance), youth allowance for job seekers, parenting payment, special benefit or Farm Household Allowance, or
- After 1 January 2020 made redundant, had working hours reduced by 20% or more, or a sole trader where business was suspended or there was a reduction in turnover of 20% or more.
There is no waiting period proposed, and no income or assets tests to apply. At this stage the release is to be requested via the ATO through your MyGov website, and not via your superannuation fund.
When?
Importantly, these superannuation changes are only announcements at this stage. Details will be provided once legislation is passed and the superannuation providers have worked out how to implement these measures. This is expected to happen throughout April.
What does this mean for me?
For superannuation pensioners that are able to reduce their current pensions payments, this is something you should consider while your pension assets are devalued over the short term. Likewise, all other non-essential withdrawals should be reconsidered for now. Please call our office to discuss this further if needed.
For clients who are concerned with meeting their current cashflow needs, please contact with us straight away. There are several strategic options available that we can discuss with you to support you at this challenging time.
