15 March 2012
Delayed FoFA start date a super save
The later start date for mandatory application of the Future of Financial of Advice (FoFA) reforms announced by the Government today would help ensure a smoother implementation of the changes, the peak body for superannuation and retirement policy and research said today.
The Association of Superannuation Funds of Australia (ASFA) welcomed the announcement by the Minister for Financial Services and Superannuation, Bill Shorten, which confirmed that while the reforms will commence from 1 July 2012, as originally announced, the application of the provisions will be voluntary until 1 July 2013.
“This decision to move the mandatory application date to 1 July 2013 is extremely sensible given the different levels of impact on different providers,” said ASFA chief executive officer Pauline Vamos.
“Final compliance will be aligned with MySuper, creating much greater efficiency for many providers.
“The FoFA reforms require significant and comprehensive changes to be made to what are, in many cases, mature and complex arrangements.
“But it also allows those that are ready to opt-in early, to road test their systems. This again may provide great comfort to trustees and directors.
“Most super funds are able to provide, or provide access to, advice for their members. These services need to be reviewed as a consequence of Stronger Super intra-fund advice reforms as well as FoFA.
“More time to comply means funds can better perfect their processes; too fast may mean over compliance, which ultimately leads to fund members not getting access to advice at lower costs.
“With so much happening in the industry at the moment and super funds also having to implement changes resulting from the Stronger Super reforms, this extra time will allow financial advisers and trustees to put themselves in a better position to be able to implement the required changes.”
ASFA had previously indicated that due to the large number of strategic and tactical decisions that would need to be made in relation to IT systems, processes and procedures, documentation and training, a delay in the mandatory application of the provisions would make sense.
“Having more time to implement the reforms will allow funds to produce better thought-out project plans, meet the challenges of staffing constraints, and prevent rushing to meet deadlines that could potentially increase the risk of error,” said Ms Vamos.
For media inquiries, please contact:
Pauline Vamos, CEO, 0433 169 342
Rebecca Glenn, GM Marketing and Communications, 0416 170 439
Megan McDougall, Media and Communications Coordinator, (02) 8079 0849
About ASFA – the voice of super
The Association of Superannuation Funds of Australia is the peak industry body representing the superannuation and retirement industry. Its members represent over 90 per cent of the approximately 12 million Australians with superannuation. ASFA members manage or advise on the bulk of the $1.3 trillion in superannuation assets as at September 2011. ASFA is the only organisation that represents all types of superannuation funds (retail, industry, corporate and public sector) and associated service providers.