Nick Bruining Q+A: Can I hold my tardy super fund HESTA liable for me missing out on a Centrelink age pension?

Question A few weeks ago you highlighted the change over in the backroom systems being used by my superannuation fund, HESTA. Two weeks ago, I retired and hoped to claim an age pension. When I was completing the Centrelink application online, it asked for a current statement from my super fund. With HESTA’s online systems shut down, I waited on the phone for over an hour to speak to someone in the call centre. When I was eventually connected, they promised to send a statement via email. But now, a week later, nothing has been received. I have no income, I can’t withdraw any money from my super and I am rapidly burning through my savings. Do you have any suggestions? Answer I am very sorry to hear of your plight and suspect many other people are in the same boat. HESTA advised Your Money that its online systems would not be available and “normal” business will not resume until June 1. This includes normal withdrawals and conversions to account-based pensions. Unfortunately, Centrelink is not obliged to back-pay incomplete applications. The effective date for payment is when the complete application is submitted. That includes whatever requirements were raised when you completed your application. If you have an old superannuation statement, you might lodge that. If a request for a more recent statement arises, you will have 13 weeks to comply, thereby preserving the current and back-pay lodgement date. The only practical suggestion is to note all of the attempts to contact HESTA, including time and date, wait times and what was said by HESTA when you were able to speak to them. Also include a record of when you had to hang up. If possible, send emails to HESTA with your requests. This all provides a “paper trail” for the future. If through HESTA’s inaction you miss out on age pension payments, it may be worthwhile seeking compensation from HESTA. Once you are in receipt of the Centrelink benefit, you would be able to calculate how much age pension you missed out on. Assuming you are single and eligible for a full age pension, that works out to be $1149 a fortnight. If you proceed with a complaint, all super funds are required to have an internal dispute resolution scheme to handle matters like this. If your claim is unsuccessful or you are unhappy with the outcome, you could then lodge a complaint with the Australian Financial Complaints Authority. AFCA is a free service and they will guide you through the process. Question I am a university graduate and have just started work in a probationary role with a large company. My grandfather mentioned that I could get a free $500 payment if I paid some money into my superannuation fund before June 30. Is this correct, and is it worthwhile? Answer Congratulations on the job. Your grandfather is correct (they always are) and he is referring to the co-contribution payment that is payable for low income earners who make a non-concessional contribution to superannuation. A non-concessional contribution is an after-tax payment. The full co-contribution rate is 50¢ per $1 contributed, to a maximum of $1000. That means if you make a $1000 payment to your super fund before June 30, you should see the $500 co-contribution hit your super account in March or April next year. In effect, it is an immediate 50 per cent return on your “investment” and the combined amount will compound over time to be worth a tidy sum. The full co-contribution is payable provided your pre-tax income for the year is less than $45,500 and 10 per cent or more of your income was derived from employment. The payment shades out at the rate of 3.33¢ per $1, so once your income exceeds $60,400, no co-contribution applies. Note that you may not be eligible next financial year if your total income exceeds the limit. Nick Bruining is an independent financial adviser and a member of the Certified Independent Financial Advisers Association