Aaron Dunn, CEO of Smarter SMSF said it is a good thing because in reality there was no basis for the five times level.

The Association of Super Funds Australia said the practical effect of the NALI amendment is that large APRA-regulated superannuation funds can continue with existing service arrangements that are in the best financial interests of their members.

“ASFA has long advocated for appropriate targeting of the NALI provisions and appreciates the Government’s rigorous consultation and pragmatic decision," it said in a statement.

Phil La Greca, Executive Manager of SuperConcepts, said although it is a small win, it is a much better outcome than the original proposal and will now apply uniformly to both large, small and self-managed funds.

Andrew Yee, Superannuation director, HLB Mann Judd Sydney, said the move to water down the NALI imposition is not a “total win, but a move in the right direction”.

“NALI is still reasonably new and it will be one of those things which will have a bit more confusion on how it will apply,” he said.

The Budget will also invest $27 million into data matching capabilities into the ATO (including matching employers and super fund data at scale) and the ATO will receive $13.2 million to build a new compliance system to proactively identify instances of under or unpaid super in near-real time.

There will also be public targets on the recovery of unpaid superannuation by the ATO and funding for the ATO to engage more effectively with business to address superannuation liabilities.

The payday super guarantee, which was announced last week, was also included in the Budget papers, but will not become effective until 2026. ASFA has consistently highlighted the detrimental impact of unpaid superannuation on retirement outcomes and recommended paying superannuation with wages, improving data matching utilising the enhanced reporting provided by funds, stronger ATO enforcement against non-compliant employers and greater transparency of the ATO’s progress in recovering outstanding amounts.

"Missing out on superannuation entitlements means people have less retirement income. Every dollar counts in retirement and that’s why measures to improve SG compliance are so important," said ASFA Deputy CEO, Glen McCrea.

Mr Le Greca there were a few issues which were not included in this Budget including residency rules and legacy pension, that had been highlighted to Treasury and still need to be addressed.

“They have long been on the agenda but there has not yet been any formal announcements on them which is not a good thing,” he said.

Mr Dunn said there was also no mention of the current 50 per cent temproray minumum pension.

"Ultimately what that would mean is we go back to standard minmums for 2023-24 year unless they do something between now and end of financial year," he said.