Issue 867, 6 September 2022
In this issue:
Miscellaneous amendments to Treasury portfolio laws: consultation
Treasury has released for consultation a package of draft amendments to a range of Treasury portfolio laws.
The consultation package includes draft legislation and regulations that propose some amendments which impact superannuation, including in relation to:
- Updating provisions of the Superannuation Industry (Supervision) Act 1993 (SIS Act) to ensure that notices of relevant decisions by a regulator are published by notifiable instrument instead of by notice in the Gazette
- clarifying that registrable superannuation entity annual member meetings can be held virtually and setting out the notice requirements for physical, virtual or hybrid meetings
- section 117 of the SIS Act – which sets out the circumstances in which a trustee of a standard employer-sponsored fund may pay an amount to a standard employer-sponsor to ensure it captures all governance structures permitted under Part 9 of the Act
- implementing technical changes to improve the operation of the First Home Super Saver Scheme (FHSSS), as announced in 2021-22 Budget:
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- increasing the discretion of the Commissioner of Taxation to amend and revoke FHSSS applications or requests for ‘release authorities’ that relate to FHSSS determinations
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- allowing individuals to withdraw or amend their FHSSS applications prior to them receiving a FHSSS amount, and allow those who withdraw to re-apply for FHSSS releases in the future
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- allowing the Commissioner to return any FHSSS amounts to superannuation funds, provided the amount has not yet been released to the individual
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- clarifying that FHSSS amounts returned to funds by the Commissioner are treated as funds’ non-assessable non-exempt income and do not count towards individuals’ contribution caps.
- prescribing matters that must be satisfied before the Commissioner can pay amounts of ATO held superannuation to a KiwiSaver provider
- prescribing the public sector superannuation schemes that can voluntarily pay unclaimed superannuation to the ATO.
The draft legislation and regulations also repeal some redundant provisions and update some cross references. The package also includes a draft legislative instrument, however the amendments it proposes do not impact superannuation.
If you have any feedback you would like ASFA to consider in relation to the consultation package, please forward it to Julia Stannard by close of business Wednesday 21 September.
Annual member meeting notices: regulations made
The Government has finalised regulations amending the disclosure requirements for registrable superannuation entities’ (RSEs) annual members’ meeting notices.
The finalisation of the Superannuation Industry (Supervision) Amendment (Annual Members’ Meetings Notices) Regulations 2022 follows consultation on a draft version in July (see ASFA Action issue 860).
The Assistant Treasurer and Minister for Financial Services, Stephen Jones MP, has noted that in response to concerns raised during the consultation on the draft version of the regulations:
“The regulations approved today will require super funds to itemise all expenditures on political donations.
Nonpolitical donations will be required to be detailed in aggregate.
The updated regulations will also enable funds to provide contextual information in their shortform summary of expenditures.
The Albanese Government is committed to a wellgoverned, highperforming and accountable superannuation system.
The Government believes the updated regulations approved today strike the right balance between reducing the regulatory burden on funds and public expectations of transparency.”
According to the explanatory material, the regulations update the annual member meeting disclosure requirements to reduce the regulatory burden for RSE licensees, by:
- removing itemised disclosure of expenditure in relation to promotion, marketing and sponsorship expenses, payments to industrial bodies and related party payments (RSE licensees will still be required to disclose an aggregate figure for these categories of expenses in their short-form summary)
- removing the double counting of certain expenditure in relation to political donations
- aligning the definition of ‘related party’ to the definition in the Australian Accounting Standards.
The Regulations also remove a restriction on including any additional information in an RSE’s short-form summary.
The Regulations apply in relation to a notice of an annual members’ meeting for a year of income for a registrable superannuation entity if the notice is given on or after 9 September 2022, for a year of income ending on or after 30 June 2022.
Your Future, Your Super performance test results 2022
APRA has released the results of the second MySuper performance test.
APRA assessed 69 MySuper products with at least five years of performance history against an objective benchmark that assesses investment performance as well as fees and costs. APRA reports that five products failed to meet the benchmark this year, including four that failed for the second time. A further five products that failed last year’s performance test passed this year.
APRA Member Margaret Cole said the overall results highlighted the improved outcomes that have been achieved for superannuation members over the last 12 months. “Pleasingly, almost 96 per cent of MySuper superannuation members are now in a performing MySuper product, equating to 13.1 million member accounts”.
Trustees of the product that failed for the first time will notify their members of the result by 28 September 2022. The four products that failed the test for a second time are now closed to new members. Of those four products, three were offered by trustees with plans to exit the industry. Ms Cole said plans were well underway for the members of those three products to transfer to new MySuper products before the 2023 performance test.
Jobs + Skills Summit: superannuation measures
The Government has released an outcomes document from the Jobs + Skills Summit held last week.
Of relevance to superannuation, the Government:
- will, as an ‘immediate action’, widen the remit of the National Housing Infrastructure Facility, making up to $575 million available to invest in social and affordable housing. “The funding can be used to partner with other tiers of government and social housing providers, and to attract private capital including from superannuation funds”
- has existing commitments relevant to boosting job security and wages, to establish a right to superannuation in the National Employment Standards and criminalise wage theft
- identified, as an ‘area for more work’, that it “will work with investors, including superannuation funds to leverage greater private capital into national priority areas, including housing and clean energy”.
ASFA REGULATORY WATCHLIST
ASFA’s Regulatory Watchlist (ARW) tracks developments in Legislation, inquiries, consultations
and other regulatory announcements relevant to superannuation.
