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Issue 773, 31 August 2020 
In this issue: 

 

APRA Superannuation Data Transformation project: consultation 

APRA has resumed the consultation process on its Superannuation Data Transformation Project, after a break of several months due to the COVID-19 pandemic. As outlined in earlier issues of ASFA Action, the multi-year project will upgrade the breadth, depth and quality of APRA’s superannuation data collection. 

APRA has released a package of four consultation topic papers to complete Phase 1 of the project, which looks at the breadth of its reporting: 

A number of draft reporting standards and pilot data request templates have been published to accompany the Topic Papers. Each of the four consultation packages has a separate due date for submissions, ranging from 2 October to 13 November. 

If you have any feedback that you would like ASFA to consider in relation to the consultation packages, please forward it to Fiona Galbraith by the following dates: 

APRA intends to finalise the nine reporting standards linked to Phase 1 (taking into account standards included as part of consultations earlier this year) early next year, and will then commence Phase 2 of the project, looking at the depth of its reporting. 

See ASFA Action issues 738, 736, 732 and 727 for background on the Superannuation Data Transformation Project. 

 

 

Internal dispute resolution: expressions of interest for ASFA working group 

ASFA is seeking expressions of interest for participation in a working group to consider issues in relation to internal dispute resolution (IDR). 

As reported in ASFA Action issue 768, ASIC recently published RG 271 Internal Dispute Resolution – a set of substantially revised IDR standards that will apply to financial firms, including superannuation fund trustees, for complaints received from 5 October 2021. 

The new standards will require major changes to financial firms’ IDR processes, including significantly reduced maximum response timeframes for many types of complaints. In particular, unless limited exceptions apply, an IDR response must be provided: 

Other important changes include an expanded concept of what constitutes a ‘complaint’, and prescription around aspects of the IDR function. 

While financial firms have just over a year to prepare for the commencement of RG 271, considerable work will be required to implement the requirements, given the magnitude of the changes. We understand that both ASIC and AFCA are already beginning to consider their approach to the limited exceptions outlined in RG 271, that allow a financial firm to exceed the maximum IDR response time where a complaint is “particularly complex” and/or circumstances beyond the firm’s control are causing complaint management delays. 

In addition, ASIC has indicated that it will shortly undertake further consultation on proposed IDR reporting measures which will require financial firms’ report prescribed IDR data, with ASIC then publishing data at both an aggregate and financial firm level. These were carved out of RG 271 following feedback—including from ASFA—that the measures required further consideration. 

ASFA will be convening a working group to provide input for ASFA’s response to ASIC’s consultation on IDR reporting, and to consider implementation issues arising in relation to RG 271. Depending on the timing of the ASIC consultation, we anticipate that the working group will meet for the first time in October. 

If you—or a member of your organisation—are interested in joining ASFA’s working group, please contact Julia Stannard by close of business Friday 11 September. 

 

 

Superannuation bills update 

Parliament debated several superannuation-related bills last week, in the first half of its last sitting fortnight before the Budget on 6 October. 

 

Extending choice of fund 

Amendments to extend choice of fund have now completed their passage through Parliament. 

The Treasury Laws Amendment (Your Superannuation, Your Choice) Bill 2019 was passed with an amendment to change the date of effect, so that choice will now apply to new workplace determinations and enterprise agreements made on or after 1 January 2021 (rather than 1 July 2020). A further amendment will require APRA to conduct a review of the new extended choice arrangements within 30 months of their commencement, to identify any unintended consequences. A number of other amendments proposed by the Opposition and cross-bench were not accepted. (See ASFA Action issues 760 and 729 for background on this Bill.) 

 

Bring forward arrangements 

The Treasury Laws Amendment (More Flexible Superannuation) Bill 2020 has been passed by the House of Representatives and awaits consideration by the Senate. 

This Bill contains an amendment extending the bring forward arrangements for non-concessional contributions to individuals under age 67, as announced in the April 2019 Budget. The amendment is intended to commence on the first 1 January, 1 April, 1 July or 1 October after the amending Act receives Royal Assent and, once law, the amendment will apply to non-concessional contributions made on or after 1 July 2020. 

The Opposition sought to amend the Bill to include a statement that the House of Representatives calls on the Government to “ensure that all Australians can enjoy a dignified retirement”, including by committing to the scheduled and legislated increases to the Superannuation Guarantee and to adequate funding for the Aged Pension. Earlier today, this amendment was rejected and the Bill was passed by the House of Representatives. 

The One Nation party has circulated a number of amendments that it intends to move to this Bill in the Senate. At a high level, these would: 

The Bill is now awaiting debate in the Senate. 

(See ASFA Action issues 760 and 755 for background in relation to this Bill.) 

Related amendments to increase the age at which the work test starts to apply to voluntary contributions from 65 to 67, and increase the cut-off age for spouse contributions from age 70 to 75, were recently implemented via theSuperannuation Legislation Amendment (2020 Measures No. 1) Regulations 2020 (see ASFA Action issue 757). 

 

Superannuation Consumer Centre 

The Treasury Laws Amendment (2020 Measures No.2) Bill 2020 has now completed its passage through Parliament, after the Senate resolved not to insist on amendments that were not accepted by the House of Representatives. Of relevance to superannuation, this omnibus Bill includes a provision making Superannuation Consumers’ Centre Ltd a deductible gift recipient. (See ASFA Action issues 760 and 755 for background on this Bill.) 

 

 

ASIC corporate plan 

ASIC has released its corporate plan for 2020-24, setting out its actions to address the impact of the COVID-19 pandemic as well as longer term threats and harms in its regulatory environment. 

The plan indicates that ASIC’s work to address the COVID-19 pandemic is guided by five strategic priorities: 

The plan also reiterates ASIC’s commitment to other longer-term focus areas, including delivering as a conduct regulator for superannuation. 

 

 

COVID-19 Coronavirus: early release of super – APRA data 

APRA has made its eighteenth weekly publication of industry-level data from its early release initiative data collection. 

The data covers applications made from inception of the early release initiative on 20 April through to 23 August. 

The data shows that from 20 April to 23 August: 

An ‘initial’ application is the first application made in respect of a member account whether this occurred in the 2019-20 financial year application period or the 2020-21 financial year application period. A ‘repeat application’ is an application for a member account that previously submitted an initial application – all ‘repeat’ applications therefore relate to the 2020-21 financial year application period. 

APRA has also published the seventeenth tranche of fund-level statistics from its early release data collection, revealing the number and value of the payments processed by each fund, as well as the time taken to make payments. 

 

 

COVID-19 Coronavirus: APRA Insight 

The latest issue of APRA’s Insight newsletter has a number of feature articles with a COVID-19 theme, including: 

The newsletter also outlines how APRA has adapted to remote supervision during the pandemic. 

 

 

ASFA REGULATORY WATCHLIST

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

and other regulatory announcements relevant to superannuation.

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