After some high profile cases where victims of convicted child sexual abusers were prevented from seeking financial redress from their abusers through the offender’s use of the super system to shield their assets, the government has now introduced two complementary draft proposals to allow victims and survivors of child sexual abuse to access the super of their offender for unpaid compensation orders.
Currently, there are three ways in which the victims of crime can seek compensation, through State and Territory compensation schemes (where the State or Territory rather than the offender pays compensation directly to the victim), compensation or reparation orders as a part of sentencing, or civil action pursued by the victim. Across all these ways, the offender’s super assets are not available to the victim.
As such, this sets up a perverse situation where offenders subject to criminal or civil proceedings relating to child sexual abuse (or those anticipating such proceedings) may be incentivised to voluntarily make large personal contributions to their own or their spouse’s super accounts to shield assets from potential compensation orders. In some high-profile cases, this amounted to millions of dollars’ worth of assets. For the purposes of draft proposals to access offenders’ superannuation, these large personal contributions are referred to as “additional” contributions.
The first proposal aims to prevent convicted child sexual abuse offenders from using superannuation to shield assets from victims and survivors where the offender is personally liable for the payment of court-ordered compensation. This proposal would provide for a court-ordered early release mechanism facilitated by the ATO. By applying to the appropriate court, victims and survivors of child sexual abuse could be awarded an amount from their offender’s “additional” contributions for the purposes of satisfying unpaid compensation orders. Victims and survivors would receive payment from the offender’s “additional” contributions to ensure superannuation cannot be used to avoid paying compensation.
The second proposal aims to improve transparency and reduce the cost and complexity of pursuing compensation by providing visibility of offenders’ “additional” contribution balances. Under the proposal, victims or survivors would be able to submit a superannuation information request to the appropriate court which could then request that the ATO discloses specific information regarding the offender’s or their spouse’s superannuation accounts. This disclosure could then inform the victim’s or survivor’s decision to pursue further proceedings.
It is proposed that “additional” contributions of the offender be identified using an objective test. All personal contributions made in the period starting either six or 12 months before the day the offender was charged, up to the day the court grants the victim or survivor payment from the offender’s relevant super interest would be deemed “additional”. No limit would be set on the amount of super that can be released from the offender’s account beyond the lessor of the total value of compensation owed to the victim and the total value of the offender’s contributions deemed “additional”.
Although the government expects these laws to apply retrospectively once passed by Parliament, both in terms of historical offences that are eligible and personal super contributions that could contribute to the final compensation sum available to the victim, it is not currently proposed to apply to compensation debts that have already been extinguished by finalised bankruptcy proceedings. While the full extent of retrospectivity is yet to be determined and is subject to consultation, any retrospective cut-off date would be at least partly informed by the relevant agencies’ limitations in regard to historical superannuation contributions and offence records, as well as other factors including limitation legislation.
