Issue 845, 15 March 2022
In this issue:
Quality of Advice Review
The Government has announced the terms of reference for the Quality of Advice Review and has appointed Ms Michelle Levy as the reviewer, with Treasury providing the secretariat. See ASFA Action issue 838 for further background.
The Government has announced that among other things, the Review will investigate:
- whether there are opportunities to streamline and simplify regulatory compliance to reduce costs and duplication;
- how to improve the clarity and availability of documents provided to consumers; and
- whether parts of the regulatory framework have created unintended consequences.
Of particular relevance to superannuation trustees, the Review will look at the legislative framework for financial advice and specifically ‘Key concepts such as ‘financial product advice’, ‘general advice’, ‘personal advice’, as well as how they are used, how they are interpreted by consumers, and whether they could be simplified or more clearly demarcated. The Review should also consider the role and bounds of advice that is scaled, intra-fund or limited in scope’.
Ms Michelle Levy, the reviewer, specialises in financial services, life insurance and superannuation law. Ms Levy has been recognised by Chambers AsiaPacific for the past 8 years as a leading lawyer in Financial Services Regulation and Superannuation and is a regular contributor to journals and publications including Financial Services Newsletter and the Superannuation Law Bulletin.
In due course the Review will invite submissions from the public and consult with stakeholders, including consumers, industry and regulators. The Review will also be informed by data collected by ASIC and Treasury.
The reviewer will provide a report to the Government by 16 December 2022.
Superannuation Data Transformation: APRA consultation – reminder comments due 25 March
APRA has commenced consultation on proposals to publish its enhanced data collection after the completion of Phase 1 of its multi-year Superannuation Data Transformation project.
APRA determined ten new reporting standards under Phase 1 of the project last September (see ASFA Action issue 825).
APRA has now released a discussion paper: Superannuation Data Transformation – Publications and Confidentiality. This outlines proposals to publish the enhanced data collection, including what will – and will not – be treated as confidential.
Starting in June this year, APRA proposes publishing new aggregate industry, fund-level and product-level statistics containing key metrics, including improved data on insurance arrangements, expenses, member demographics and asset allocation classifications. Where relevant, new approaches will be used to better enable comparisons across complex fee and cost structures or insurance design.
APRA is proposing to determine most of the data collected under Phase 1 as ‘non-confidential’, and therefore able to be published. It will be the first time APRA has published data on all products and investment options — until now, APRA has only published product-level data for MySuper products.
In addition to the expanded data publications, APRA has indicated it plans to introduce two types of datasets for users to access published statistics in a format that is easily consumed by their own reporting tools:
- key metrics datasets which primarily mirror the statistics in the publications without formatting
- granular datasets for sophisticated users to access more detailed data in a format that closely resembles the data as reported.
APRA intends to issue its final determinations around data confidentiality in June, with the first statistical publication under the new reporting standards released soon after.
If you have any feedback that you would like ASFA to consider in relation to the consultation, please forward it to Julian Cabarrus by close of business Friday 25 March.
Australian Financial Complaints Authority: proposed new funding model
The Australian Financial Complaints Authority (AFCA) is consulting on its proposed new funding model, which will replace the current (interim) model. The new funding model will apply from 1 July 2022.
The proposed new funding model includes a single registration fee for financial firm members, and a simplified complaints fee structure.
Consultation material is available on the AFCA website. The consultation material includes:
- the key elements of the proposed new funding model
- the proposed new fee structure
AFCA also will make available on its website links to webinars on the proposed new funding model.
ASFA will be preparing a response to the AFCA consultation. If you have any feedback you would like ASFA to consider in relation to the proposed new funding model, please forward it to Andrew Craston by close of business Friday 15 April.
ASFA REGULATORY WATCHLIST
ASFA’s Regulatory Watchlist (ARW) tracks developments in Legislation, inquiries, consultations
and other regulatory announcements relevant to superannuation.
