Government starts third and final part of PC super system review

The Government has started the third and final part of the Productivity Commission’s review of the efficiency and competitiveness of the superannuation system.

“The Turnbull Government has taken further action to ensure Australia’s superannuation system is as efficient and competitive as possible with the release of the Terms of Reference for the Productivity Commission’s system wide review,” said a joint statement by Treasurer Scott Morrison and Minister for Revenue and Financial Services Kelly O’Dwyer.

This third part of the review will build on the previous two inquiries into how to assess the competitiveness and efficiency of the super system and alternative models for setting default funds. The final report for assessing the super system was completed in November 2016 and the final alternative default super models report is due to be given to Government in August 2017.

“The Government has asked the Productivity Commission to complete the review within 12 months to provide the early provision of the evidence base for future reforms to the superannuation system, with a draft report to be provided to the Government by the end of January 2018,” said the joint statement.

The Terms of Reference say: “The Commission is to assess the efficiency and competitiveness of Australia’s superannuation system and make recommendations to improve outcomes for members and system stability. The Commission is to also identify, and make recommendations to reduce, barriers to the efficiency and competitiveness of the superannuation system.”

The Productivity Commission plans to produce an issues paper, followed by a draft report in January 2018 and a final report by June 2018.

The joint statement from Morrison and O’Dwyer said: “The Turnbull Government will continue its reform agenda in 2017 by progressing legislation to deliver higher standards of accountability and transparency for superannuation funds to ensure Australians can have confidence in the superannuation system.”

This likely refers to the delayed changes to the governance of large superannuation funds, changes to super fund choice rules and fund disclosure requirements.

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