Search
Close this search box.
Issue 720, 11 September 2019 
In this issue: 

 

Protecting Your Superannuation and miscellaneous super amendments: consultation 

Treasury has commenced a brief consultation on draft legislation and regulations proposing amendments to aspects of the Protecting Your Superannuation (PYS) reforms, as well as a number of miscellaneous superannuation amendments. 

The draft Treasury Laws Amendment (Measures for a later sitting) Bill 2019: miscellaneous amendments (draft Miscellaneous Amendments Bill) addresses an issue with the application of the fee cap on low superannuation balances. The Treasury Laws Amendment (Protecting Your Superannuation Package) Act 2019 (PYS Act) amended the Superannuation Industry (Supervision) Act 1993 (SIS Act) to apply a cap on the fees that could be charged by a superannuation trustee when the balance of a product held by a member was less than $6,000 at the end of the year. The PYS Act did not provide for a fee cap where the member has a balance of less than $6,000 but ceases holding the product part way through the fund’s income year. 

In a related context, the draft Miscellaneous Amendments Bill also includes amendments that: 

The draft Miscellaneous Amendments Bill also includes a number of miscellaneous superannuation amendments that are unrelated to the PYS reforms or the unclaimed superannuation rules. These include amendments to: 

The commencement of these provisions was previously linked to superannuation guarantee integrity measures around salary sacrifice contributions that were to be introduced via the Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 2) Bill 2019. That Bill lapsed when Parliament was prorogued prior to the 2019 federal election and the measure is now being implemented via the Treasury Laws Amendment (2019 Tax Integrity and Other Measures No. 1) Bill 2019 (Integrity Bill) (see ASFA Action issue 717). 

To reflect this, it is now proposed to align commencement of the employer reporting requirements with the commencement of the Miscellaneous Amendments Bill, or the relevant part of the Integrity Bill, whichever is later. This will ensure that the reporting requirements apply prospectively from the time that both the salary sacrifice measure and the amendments to the revised commencement rule commence. 

Treasury has also issued draft Treasury Laws Amendment (Measures for a Later Sitting) Regulations 2019. Of relevance to superannuation, these repeal regulations made under a transitional provision in the SIS Act. These regulations are redundant and as such their repeal does not have any practical effect. The regulations to be repealed were made under—and specified conditions for—a redundant transitional provision in the SIS Act, which was repealed by the Treasury Laws Amendment (2019 Measures No. 1) Act 2019 (see ASFA Action issue 704 and 698). 

If you have any feedback you would like ASFA to consider in relation to the superannuation-related aspects of either the draft Bill or Regulations, please forward it to Maggie Kaczmarska by close of business Friday, 20 September. 

 

 

Strengthening ASIC’s enforcement and supervision powers: consultation 

Treasury is consulting on amendments to strengthen ASIC’s enforcement and supervision powers, in line with the recommendations of the ASIC Enforcement Review Taskforce and the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry. 

The Taskforce was established in October 2016 to fulfil the Government’s commitment to review the adequacy of ASIC’s enforcement regime in response to the Murray Financial System Inquiry. The Taskforce conducted a number of consultations during 2017 and made 50 recommendations to strengthen ASIC’s powers and penalty regime. In April 2018 the Government published the Taskforce’s report and its response, agreeing in principle to all 50 recommendations. A number of the recommended reforms have already been implemented (see ASFA Action issues 668, 698 and 699), however some were deferred for consideration alongside the final report of the Royal Commission. 

The Commission ultimately endorsed the outstanding Taskforce recommendations (see ASFA Action issue 697), and Treasury has now released a package of exposure draft legislation addressing their implementation. 

The draft legislation proposes amendments to: 

If you have any feedback you would like ASFA to consider in relation to the proposed reforms, please forward it to Julian Cabarrus by close of business Wednesday, 25 September. 

 

 

APRA: updated enforcement approach 

APRA has updated its enforcement approach to outline how it will increase transparency around the use of its formal enforcement powers. APRA has also set out its intention to take stronger action against institutions that fail to meet their legal obligations to report data to APRA in full and on time. 

APRA published its new enforcement approach in April, following a review of the regulator’s historical approach to enforcement (see ASFA Action issues 706 and 691), detailing a ‘constructively tough’ enforcement appetite, and a willingness to use its powers more assertively to hold regulated entities and their leaders to account. 

Deputy Chair John Lonsdale said the enforcement approach now clarifies when and how APRA will publicise the action it takes. In particular, he noted that as well as taking stronger action earlier where regulated entities break the law, or fail to behave in an open and cooperative manner with APRA, getting ‘constructively tough’ also involves APRA setting public examples where it is appropriate to do so and there’s no risk to financial stability. 

In addition, Mr Lonsdale said that as the central statistical agency for Australia’s financial sector, including other regulators, APRA must ensure the data it receives is timely and accurate. The enforcement approach has accordingly been updated to include guidance on how APRA will use enforcement action to ensure the data they collect remains fit for purpose. 

 

 

Processing of First Home Super Saver release authorities 

The ATO has reminded fund trustees that they must action release authorities issued under the First Home Super Saver (FHSS) scheme within ten business days of the date of issue. They have published some guidance to help funds meet their FHSS obligations. 

Super CRT Alert 044/2019 Processing First home super saver (FHSS) release authorities notes that the ATO has found that a large number of funds are not meeting their obligations to action FHSS release authorities within the required timeframe. The ATO has developed a set of scenarios to help funds meet their obligations and action FHSS release authorities appropriately. 

The ATO has indicated that it will shortly be contacting funds that have a high proportion of late FHSS release authorities, and will do follow-up checks to assess whether there has been an improvement in processing performance. 

 

 

ASFA REGULATORY WATCHLIST

ASFA’s Regulatory Watchlist (ARW) tracks developments in Legislation, inquiries, consultations

and other regulatory announcements relevant to superannuation.

Search
Close this search box.
Search
Close this search box.

Logged in as

Most recent