- ASIC suggests super funds lift game on insurance, before regulator gets new powersASIC has suggested that super funds put more effort in to improving insurance in super, pointing out that changes next year could give the regulator the power to enforce the … Read more
- Eligible Rollover Funds to be shut down, under Government planThe Government has announced it will move to effectively shut down Eligible Rollover Funds by mid-2021, with the superannuation going to the ATO. Eligible Rollover Funds (ERFs) are super funds … Read more
- Super fund and women’s legal service working for simpler super splittingIndustry super fund HESTA and the Women’s Legal Service Victoria are working together to get the process for splitting super assets simplified, with the aim of more women claiming their … Read more
- Early super access scheme punished with $220,000 penalty, ban from setting up SMSFsRunning an illegal early access to superannuation scheme has led to financial penalties and a ban from setting up SMSFs. The Federal Court has handed down a $220,000 penalty to … Read more
- APRA MySuper heatmap released, retail fund-linked groups warn about usageAPRA has released its first superannuation performance heatmap, covering every MySuper product. This new tool has been criticised by parts of the superannuation industry – particularly by those close to … Read more
Current status of government superannuation policies
The status of government superannuation policies in development and implementation.
Currently before Parliament
- Super Guarantee amnesty for employers
- Bill currently before the Parliament: Treasury Laws Amendment (Recovering Unpaid Superannuation) Bill 2019. This is the second attempt by the Government to introduce an amnesty for employers who haven’t paid Super Guarantee.
- Expand super choice to cover more workers
- Legislation lapsed at last Federal Election, has been introduced again in the Treasury Laws Amendment (Your Superannuation, Your Choice) Bill 2019.
- Transferring all money from ERFs to the ATO
- In mid-December the Government announced the intention to effectively shut down Eligible Rollover Funds, with a plan to require them to transfer all super holdings to the ATO. The Government intends to introduce legislation for this to Parliament “early” in 2020.
- Increase SMSF member cap to 6
- Was included in the Liberal Party’s list of election policies. Prior to that, was included in a Bill put to the Parliament before the election, but removed by amendment. Legislation would need to be reintroduced to Parliament.
- Three year audits for SMSFs
- Outcomes of consultation were “currently being considered”, as of June 2019. Public consultation on draft legislation by Treasury closed in August 2018.
- Allow victims of domestic violence to access superannuation
- Announced late in 2018, victims of domestic and family violence would be able to access some of their superannuation. Legislation has yet to be introduced to Parliament. Recent Freedom of Information documents show the policy has “no announced start date.”
- Review of early release of superannuation rules
- Consultation on the review closed in February 2019. According to Freedom of Information documents, “stakeholders are anticipating a Government response”.
- At least one-third independent directors for large super funds
- Legislation lapsed at last Federal Election, and has yet to be reintroduced.
- Setting objective for superannuation system in legislation
- Bill to put objectives for superannuation in legislation was introduced to Parliament in November 2016, but hadn’t passed by last Federal Election, and so lapsed. Bill would need to be reintroduced to Parliament.
From the 2019/20 Budget
- Streamlining ECPI
- Announced in the 2019/20 Budget, this change is meant to apply from 1 July 2020, This would include allowing super funds in both accumulation and retirement phases to be able to choose the method of calculating ECPI, and removing a redundant requirement for super funds fully in retirement phase and using the proportionate ECPI method to obtain an actuarial certificate. Draft legislation has yet to be released.
- Extending non-concessional contribution bring-forward to ages 65 & 66
- Also as part of the 2019/20 Budget, the Government proposed that people aged 65 or 66 be able to use the non-concessional contribution bring-forward rule. This has yet to be legislated.
- Raising Work Test age
- It is proposed that, from 1 July 2020, people aged 65 or 66 will be able to make voluntary super contributions without having to meet the ‘work test’. Announced as part of the 2019/20 Budget, this has yet to be legislated.
- Raising age limit for spouse contributions
- The Government has proposed increasing the age limit for spouse contributions would be increased from 69 to 74. This has yet to be legislated.
- Super fund merger tax relief to be made permanent
- Announced in the 2019/20 Budget, this has yet to be legislated. On this measure, Assistant Minister for Superannuation, Financial Services and Financial Technology Jane Hume has said: “The Government is committed to passing this legislation and this change has bipartisan support.”
- Superannuation Consumer Advocate
- The 2019/20 Budget included $100,000 for an “expression of interest process” around a Superannuation Consumer Advocate. Treasury started the process in early December.
- SuperStream for rollovers for SMSFs delayed
- Comprehensive Income Products for Retirement (CIPR)
- A recommendation of the Coalition’s Financial System Inquiry, under which super fund trustees would pre-select an income product for the retirement of members. The start date was delayed until July 2022.
- Portfolio Holdings Disclosure
- The Government passed changes to the Portfolio Holding Disclosure (PHD) legislation earlier in 2019. But the implementation is dependent on regulations, which have yet to be made. ASIC recently again delayed the start date for PHD until 31 December 2020 due to the lack of the regulations. PHD was originally meant to start on 1 July 2015
Recommendations of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry
- 3.1 – No other role or office for trustees of super funds. The Government said it would “address the risks” of dual regulated entities with such a prohibition. Legislation to be introduced by 30 June 2020.
- 3.2 – Ban on deducting advice fees from MySuper accounts. Legislation to be introduced by 30 June 2020.
- 3.3 – Limits on deducting advice fees from Choice product accounts. Government agreed, “consistent” with requirements around ongoing fee arrangements. Legislation to be introduced by 30 June 2020.
- 3.4 – Prohibition on ‘hawking’ of superannuation products. Legislation to be introduced by 30 June 2020.
- 3.5 – A person should have only one default account. The Government agreed with the recommendation, but there is no details on the method or any timeframe for it to be implemented. The Government says the recommendation will be “considered in the context” of related recommendations from the Productivity Commission – which the Government has had since late 2018 and to which it has yet to respond.
- 3.8 – Adjustment to roles of APRA and ASIC in respect of superannuation. Legislation to be introduced by 30 June 2020.
- 3.9 – Extend Banking Executive Accountability Regime (BEAR) to large super fund trustees (RSEs). Legislation to be introduced by 31 December 2020.
The above list is not exhaustive and based on publicly available information.
Status of current superannuation Bills
- Treasury Laws Amendment (Your Superannuation, Your Choice) Bill 2019
- Before the House of Representatives | Second reading moved 27/11/2019
- Expansion of super choice to new enterprise agreements and workplace determinations
- Treasury Laws Amendment (Recovering Unpaid Superannuation) Bill 2019
Passed superannuation legislation
Superannuation-related legislation that has passed the Parliament.
- Treasury Laws Amendment (2019 Tax Integrity and Other Measures No. 1) Bill 2019
- Assent – 28/10/2019
- Salary Sacrifice integrity, other tax changes
- Treasury Laws Amendment (2018 Superannuation Measures No. 1) Act 2019
- Assent – 02/10/2019
- Super Guarantee opt-out for high income earners, Non-arm’s length expenses, LRBA in Total Super Balance
- Treasury Laws Amendment (Putting Members’ Interests First) Act 2019
- Assent – 02/10/2019
- Opt-in changes to insurance in super for new young members and balances under $6,000