• SuperStream research - employers and APRA funds

    In September 2015, the ATO commissioned research into employers’ progress on the implementation of SuperStream and their experience with paying super.

    A representative sample of 1,920 employers were surveyed across Australia covering all sizes, industries and geographies. Combined with other data collected by the ATO, these results form a snapshot of this implementation at a point in time. They also provide an important input into the measurement of SuperStream benefits, while helping the ATO inform its wider work on improving the employer experience.

    For more information see the Super Reform research reportThis link will download a file.

    The first quarterly APRA Report Standard SRS711.0: SuperStream Benchmarking Measures has been finalised.

    The data collected from APRA funds in the quarterly reporting series will assist in measuring the implementation benefits of SuperStream.

    The SuperStream Benchmarking Measures – September 2015 results are available.

    SuperStream employer research September 2015

    In September 2015, the ATO commissioned Colmar Brunton Social Research to survey employers on their SuperStream implementation progress and their experience with paying super. A representative sample of 1,920 employers were surveyed across Australia covering all sizes, industries and geographies.

    Combined with other data collected by the ATO, these results form a snapshot of this implementation at a point in time and also provide an important input into the measurement of SuperStream benefits.

    The survey data was collected in mid-to-late September 2015 just prior to a major surge of implementation by employers in October for the quarterly reporting period (31 October was also the end of the ATO’s compliance flexibility period for medium to large employers). The results therefore do not reflect the current state of take-up by employers which has continued to grow rapidly since this period.

    While the survey provides significant insights into the implementation of SuperStream, the following limitations should be borne in mind when interpreting the results:

    The survey responses were skewed somewhat toward large and medium employers (34% of respondents compared to 12.5% of actual population) – this was driven by the research firm to try to get large enough statistical groups at the larger end of the employer market.

    Despite this skew, the number of respondents at the large employer end of the survey does not always provide a statistically reliable sample for wider interpretation of some questions.

    The ATO’s review of the raw data noted there was a significant element of misreporting and/or confusion by respondents over their channel for paying contributions and implementing SuperStream. For example, a major proportion of respondents said they used the Small Business Clearing House when they were clearly ineligible; further analysis showed their responses to other questions in fact pointed to use of different channels. This cohort were likely to be users of a commercial clearing house solution, not the government service.

    Key summary of findings

    Super and payroll features

    • Overall, 46% of respondents said superannuation guarantee payments were made monthly with a further 43% who said payments were quarterly:  
      • In small business with 1-4 employees this was 36% and 49% respectively
      • In small business with 5-19 employees this was 54% and 40% respectively
      • In medium business with 20-199 employees this was 73% and 21% respectively
       
    • The most common software packages used were MYOB at 43%, followed by Reckon (7%) and Xero (7%).
    • Around one in three small businesses with 1-4 employees do not use software or do payroll manually (32%)  
      • This was true for one in five businesses across the whole of the small employer population (19 or fewer employees)
       

    Due to the skew in sampling, this underestimates the proportion of businesses not using payroll software. Internal data available to the ATO suggests around 33% of all small businesses do not have/use payroll software.

    Awareness

    • Over two-thirds of all employers were aware of SuperStream
    • Businesses with 1-4 employees were more likely to have not heard of SuperStream (47%) but reported awareness was still significant (53%)

    The ATO concludes this significantly understates actual awareness due to a number of factors including the survey method, who responded to the survey and evidence that some employers had implemented ‘without being aware’.

    • Businesses with 5-19 employees reported high levels of awareness (74% including those already implemented), with only 24% claiming to be unaware or ‘don’t know’.

    Implementation status

    • Nearly 7 in 10 large employers (69%) reported being well advanced in their implementation of SuperStream (completed one or more payment cycles)
    • Medium employers were also well progressed with 64% reporting being well advanced
    • Around 17% of small business reported being at the same stage of implementation.

      These results underestimate the actual implementation due to the seamless nature of some solutions to employers including the Small Business Superannuation Clearing House and some ‘Channel B’ electronic solutions like SCH Online (AAS).
    • Just over three quarters of respondents (77%) indicated that they had not experienced any significant barriers to implementation.
    • For the 22% who reported barriers, these were typically broken down into ‘lack of time’ (29% of instances) followed by ‘not clear what they need to do’ (23%) and ‘requires collecting additional data or information from employees’ (15%).
    • Of those businesses that had reported implementing SuperStream and completed one or more cycles, 63 per cent indicated the transition was ‘very easy’ or ‘easy’, with another 20 per cent indicating it was neither easy nor difficult. The 12 per cent who indicated the transition was ‘difficult’ or ‘very difficult’ indicated the key reasons were that it was time consuming to set-up, the data information collecting and entering process was difficult, or it was difficult to understand or use.

      These results highlight the importance of three variables on the implementation effort - how well prepared/organised the employer already was; what solution partner was chosen; and how many super funds the employer deals with.

    Benefits

    • Just under half of all respondents who had implemented SuperStream and completed one or more payment cycles said the key benefit was less time involved in making super contributions.  
      • One-fifth highlighted the benefits of ‘less paperwork and cheques’, with 13 per cent saying it was generally ‘more efficient/easier’.
      • The average time taken for employers to complete their superannuation contributions decreased by around 70% after implementing SuperStream, and tended to improve further after the first payment cycle
       

    After removing outliers, more detailed analysis of the raw data by the ATO reveals a wide but generally consistent pattern in the distribution of benefits with bigger gains to those with many funds relative to their size (10-200 employee range) and those starting from a lower base of automation/data integrity (See Attachment A for quartile analysis by size of business).

    Attachment A: Quartile analysis by business sizeThis link will download a file

    The ATO notes that the data also shows a clear positive correlation between the size of business (as measured by number of employees) and effort savings from SuperStream as the complexity of multiple dealings with funds is reduced.

    • One-third of respondents who were implementing SuperStream said they were yet to experience any benefits. Micro businesses with only one employee typically experience no time saving benefit from SuperStream, but from two employees upwards efficiency benefits start to accrue.

    This result falls well within the ATO’s expectations given that 10-15% of employers already had good digital/single channel processes in place before SuperStream; and a significant proportion of implementations are still in the first time through stage.

    Communication preferences

    • The overwhelming majority of businesses (76%) preferred receiving SuperStream information via email. This extended to businesses with 1-4 employees who prefer receiving information via email (66%) and their most strongly preferred channel was their accountant/bookkeeper (5%)

    For more information see the Super Reform research reportThis link will download a file.

    SuperStream APRA fund benchmarking measures – September 2015 quarter

    The first quarterly APRA Report Standard SRS711.0: SuperStream Benchmarking Measures has been finalised.

    The data collected from APRA funds in the quarterly reporting series will assist in measuring the implementation benefits of SuperStream.

    Table 1 SuperStream benchmarking measures

    September 2015

    Contribution transactions from active employers

    Channel A

    12,401,606

    Channel B

    10,380,041

    Non-conforming channels

    8,860,816

    Total contribution

    31,642,463

     

    Proportion of contribution transactions from active employers

    Channel A

    39%

    Channel B

    33%

    Non-conforming channels

    28%

    Total contribution transactions from active employers

    100%

     

    Total cost of processing contribution transactions from active employers ($m)

    39.3

     

    Notes:

    Data are for APRA-regulated RSEs and are sourced from the superannuation reporting form SRF 711.0 SuperStream Benchmarking Measures submitted to APRA under the Financial Sector (Collection of Data) Act 2011.

      Last modified: 24 Mar 2016QC 48289