Mitch Fifield (Victoria, Liberal Party, Assistant Minister for Social Services) Share this | Hansard source

I do not think there are other colleagues looking to make contributions, so I will sum up at this point. As has been canvassed, this bill will introduce a further 2015 budget measure improving the fairness and sustainability of the pension system for improved fairness and equity. The bill will make sure a fairer proportion of superannuants' actual defined benefit income is taken into account when the social security income test is applied.

From 1 January 2016, this measure will introduce a 10 per cent cap on the defined benefit income test that can be excluded from the social security income test. A defined benefit income stream is a pension paid from a public sector or other corporate defined benefit superannuation fund where the pension paid generally reflects years of service and the final salary of the beneficiary.

Current arrangements allow some defined benefit superannuants to have a larger proportion of their superannuation income excluded from the pension income test, but it is important to point out that people receiving Department of Veterans' Affairs pensions will not be affected by this change and that defined benefit income streams paid by military superannuation schemes will be excluded. This is essentially an equity measure. I commend the bill to the Senate.

Question agreed to.

Bill read a second time.