In a letter addressed to the FPA chief executive Dante De Gori in response to an FPA query, Mr Morrison outlined plans to exempt those receiving structured settlements or orders for personal injuries from the transfer balance cap proposed in this year’s budget.
“This will ensure that these individuals, who need access to large amounts of funds to meet their daily healthcare and living needs, will not face a faster depletion of their lump sum,” Mr Morrison said in the letter.
FPA professional standards and advocacy manager Ben Marshan supported the move, saying the FPA initially brought up the concerns with Assistant Treasurer Kelly O’Dwyer on budget night, 3 May.
“Structured settlements can often be multiple millions of dollars,” Mr Marshan said.
“[Individuals] often use superannuation as a vehicle to more effectively manage those investments.
“We were significantly concerned that there may not be an exemption within the new rules, so we’re very supportive of that measure,” he said.
In addition, Mr Morrison noted that the lifetime non-concessional contributions cap of $500,000 would also not include payments relating to structured settlement or orders for personal injuries.
