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  • SASG minutes 10 November 2015

    Meeting details

    Venue:

    Rooms 719 & 720, Level 12, ATO Latitude East, 52 Goulburn Street, Sydney NSW 2000

    Date:  

    Wednesday 10 November 2015

    Start:  

    10.00am

    Finish:  

    2.40pm

    Chair:  

    Cathy Cox

    Contact and Secretariat:  

    Phil McDonald

    Contact phone:  

    08 8218 9460

    Attendees

    AMP

    Tina Cifelli

    ASFA

    Fiona Galbraith

    Bravura Solutions

    Martin Mikulicin

    BT

    Kelly Kerr

    CBA (Colonial Mutual)

    CBA (Colonial Mutual)

    Ari Gerasimou

    Padraig Houlihan

    Colonial First State

    Namphi Nguyen

    Commonwealth Superannuation Corporation

    Lex Dransfield

    Financial Synergy

    Andrea Cooper

    IOOF

    Tania Wilson

    Link Group (AAS)

    Alan Harvey

    Link Group (AAS)

    Sue Pearce

    Link Group (GESB)

    Sharan Panton

    Link Group (Super Partners)

    Eoin Burke

    Link Group (Syncsoft)

    Mary Gale

    Mercer

    Amanda Gunn

    NAB

    Janice Low

    Perpetual

    Kathy Calman

    Precision Admin

    Warren Ramage

    QSuper

    Jayne O'Ryan

    Unisuper

    George Strilakos

    Zurich

    Maria Ainslag

    ATO - Chair

    Cathy Cox

    ATO - Secretariat

    Phil McDonald

    ATO

    Ian Colhoun

    ATO

    Mark Barnett

    ATO

    Linda Cheesman

    ATO

    John George

    ATO

    Louie Markovski

    ATO

    Shaun Ferabend

    ATO

    Loretta Green

    ATO

    Jamie Mendyk

    ATO

    Tracie Crowden

    ATO

    Julianne Faulks

    Apologies

    GESB

    Lesley Walker

    IOOF

    Heide Stewart

    CBA - Colonial First State

    May Low

    Commonwealth Superannuation Corporation

    Commonwealth Superannuation Corporation

    Peter Zorbas

     

    Scott James

    NAB/MLC

    Ian Roberts

    Pillar

    Louise Hemas

    Precision Admin

    Anne Dixon

    Perpetual

    Rebecca Scott

    Super SA

    Garry Powell

    SMSF Australia

    Graeme Colley

    ATO

    John Shepherd

    ATO

    Louise Elliot

    ATO

    Victoria Hopley

    Next meeting

    Tuesday 24 February 2016

    Please note: SASG agendas, minutes and related papers are not binding on the ATO or any of the other bodies referred to in these papers. While every effort is made to accurately record views expressed, the wording necessarily represents a summary of statements of general position only, and care should be taken in interpreting those statements. These papers reflect the position at the date of release (unless otherwise noted) and readers should note that the position on any issue may subsequently change.

    Agenda Items

    1 Opening

    Cathy Cox (Assistant Commissioner), Client Account Services, Superannuation and Accounting) opened the meeting:

    • Welcomed all in attendance including new representatives and guest attendees.
    • Accepted that no declarations of conflict of interest were advised.

    2 Acceptance of Previous meeting Minutes / Update on action items

    Minutes of meeting held Wednesday 26 August 2015 endorsed without amendment.

    All action items were resolved:

    • Implemented "improving the timeliness and efficiency of CRT" - see agenda item 4.
    • ATO Release Authority matrix distributed - see agenda item 6.3.

    3 ATO Reinvention of APRA Fund Experience

    3.1 ATO Reinvention of APRA Fund Experience

    Mark Barnett made reference to briefing note 3.1 and APRA Regulated Superannuation funds:

    • Planned initiatives for validation and completion document. He gave an update on the workshop held on the 27th May 2015.
    • Members confirmed that we have captured the themes of the workshops and were very impressed with the interactive being run by the ATO and are positive about the future.
    • The ATO is planning to implement the changes in two sections; completed quick wins and medium term priorities. Longer term priorities will include out online services and streamline administrative processes.

    3.2 Reinventing future experience workshop Canberra 23 October 2015.

    The participants nominated five key areas that they saw as a priority, where the ATO could make improvements. We are working towards a 4 year plan. Looking to the future, the ATO will continue to listen to what industry requires and reassess our direction. Members agreed that this is a positive change.

    Talk book issued on Monday 9 November 2015.Members were thanked for their active contribution.

    4 CRT Interactions

    Linda Cheesman provided an update on the ATO consultation process on improving the timeliness and efficiency of CRT interactions.

    We have recently implemented the new triage process as advised by CRT alert 048/2015. The start date of 02 November was discussed and funds were encouraged to implement these new arrangements. We would like you to advise if there are any issues with this or any feedback, we understand that there may be teething problems either end.

    Reiterated the commitment of both industry and the ATO to work together to achieve the desired outcomes and act within the terms and conditions.

    Further discussions are still to be had with our internal stakeholders to ensure commitment to the agreed timeframes.

    A further code for Legislation (procedural issues) was requested, we will look to incorporate any feedback in the near future. However we will require a longer period to allow for more funds to provide feedback and implement.

    Glowing feedback was received on response rates from CRT from those funds who have already implemented this process.

    Legislation (technical) enquiries will need to use a different mailbox. This will be provided in the monthly communique.

    5 Update on ATO Peak Processing

    Linda Cheesman gave a quick update on MCS lodgements and advised that as of Friday 02 November the ATO had processed 28.42 million within our systems.

    At different times there were around 1-2 million forms that were suspended however this was continually moving and there were no issues at this point in time. As of Friday 02 November there was approximately $498 million dollars of LISC entitlements and growing, we expect to hit the $500 million mark (approximately same amount as last year). Payments and files are due to issue on time. Funds advised that if there were any issues we would advise impacted funds/suppliers.

    One issue funds mentioned that was causing a problem was that if there was a rogue carriage return within the MCS file it was very hard to locate the error. ECI used to send an error message which greatly assisted in locating the problem. Is it possible that an error message could be sent to help locate where in the file this is happening?

    6 Product Update

    Div 293 Tax and Excess Contributions

    Louie Markovski gave a general product update and advice to funds:

    • on meeting Release Authority obligations.
    • Div 293 tax and excess concessional/non-concessional contributions FTECC and RENCC.
    • What are we doing to improve the client and fund experience.

    Key issues discussed:

    • Minimising Div 293 tax assessment churn by adjusting our relevant batch runs FTECC and Div 293. We will reschedule the batch runs for FTECC and Div 293 products during November and December 2015.
    • Complying with authority to release benefits due to excess concessional/non-concessional contributions FTECC/RENCC.

    6.1 Release Authority Payments

    A number of funds are not fully complying with the ATO Release Authority Statement (RAS) instructions and therefore causing reverse workflows for the ATO and affected funds. Discussion around the Release Authority letter and the first paragraph and that this is confusing. Funds have been working with staff to make sure they follow the instructions in the body of the letter and do not issue the money to the member.

    6.2 Release Authority Matrix

    Issued 05 November 2015 we are seeking feedback from industry on a RAS matrix that illustrates the various release authorities and relevant obligations. This tool is available to funds to improve their understanding of RA’s and make compliance easier.

    Member contribution reporting Unfunded Defined Benefit funds (UDB) Discussed incorrect practice by some funds and asked that these be addressed. Some funds are recording a wrong/incorrect or dummy Fund TFN in the member section of the MCS where Provider TFN is requested. This is causing downstream impacts for Division 293 tax assessment – suspending members’ assessments -96305 errors (Provider TFN is not valid). Members were requested to correctly capture their Fund TFN on the member’s section of the MCS.

    Risks/Hotspots

    Identified that this year excess concessional contributions are incorporated in an individual’s income tax assessment. The ATO will not be suspending the issuing of an income tax assessment. Normal income tax processing will occur.

    Where funds are not able to comply with this legislative requirement and have made a reasonable effort to return the release authority statement and payment; and have been able to do so, the ATO will apply a practical risk based approach in applying administrative penalties.

    6.3 SuperTICK 2 update

    Mark Barnett asked members to use best practice and provide all known information on the first validation request and include the TFN to limit the impact as we move to SuperTICK 2. SuperTICK performance slows when validation requests are submitted without a TFN.

    If funds require more information about the SuperTICK pre Validation tool contact SuperTICK team via SprEnablingService@ato.gov.au.

    Risks/Hotspots

    Not providing a TFN in SuperTICK 2 should only occur when a fund has no TFN for the member in question on its database, funds should provide a TFN if available. The SuperTICK errors list is published. Users can obtain a copy by contacting the SuperTICK team via SprEnablingService@ato.gov.au

    Funds asked about the Christmas outage as they need to know for resourcing during this period. We are still trying to tie down the dates systems will be available. We have not confirmed dates when the systems will be available and from what time. First working day for funds is the 29 December 2015. No help desk available from 25 December 2015 to 03 January 2016 as the ATO is closed.

    7 Reuniting Super Update

    Shaun Ferabend provided an update on Electronic Portability Forms (EPF) volumes.

    From 1 July 2015:

    • 276,000 accounts consolidated worth 1.2 billion dollars
    • EPF volumes have increased considerably this year (449,766 accounts consolidated last financial year worth $1,964b)
    • Most are fund to fund transfers.
    • The biggest influence is the uptake of MyGov as of 31 October 2015 there were: 4,267,456 active ATO MyGov links.
    • 16,968,217 ATO online logins, compared to 9,994,059 logins during last tax time; and
    • 2,780,934 myTax/e-tax lodgements (a 4.1% increase over last year). myTax contributed 59% of the lodgments, compared to 37% last year.

    MyGov now has a new personalised page that includes, debt, your tax return is due and check your super and the number of accounts you may have as well.

    Provision of Address (POA). We will start gathering data in early November and plan to have the Provision of Address available for the funds before Christmas. Member feedback on the process was positive and was a phenomenal success in removing people off the lost members register.

    A CRT alert will be sent when the information is available for you to pick up from the transfer facility.

    Funds to email Super CRT if they would like to participate.

    Campaigns

    • Current outbound campaigns include 50,000 fund nomination letters and or emails which have issued over the last few months. SHA annual statement run on the 8 October 2015 issued 64,000 pieces of correspondence of which approximately 6,000 went electronically to myGov. Examples of any issues to be sent to the SASG Secretariat mailbox then to be forwarded to Shaun Ferabend for follow up.

    8 Update on Large Fund Diagnostic report process

    Teleconference for interested parties was held on the 1st October to discuss the trustee and administrator experience. Feedback from industry has resulted in ATO commitment to provide reports to trustees in March 2016. Industry indicated that the report is of significant value and that the ATO is heading in the right direction.

    9 LMR Re-Report

    Lost Member Register (LMR) Re-Report 2016, information was provided on reporting requirements, managing the lodgement of reports and the due dates for reporting.

    The ATO will not be granting any further deferrals past 31 May 2016.

    Queries regarding your 2016 LMS can be directed to:

    10 Lost and Unclaimed Legislative Changes

    John George and Jamie Mendyk provided guidance and context regarding a number of legislative changes that will start to impact funds within the next 6 months.

    Timeline provided with the Obligations and Key Messages discussed with the group including:

    • Changes to lost and unclaimed reporting timeline
    • In the points relating to MIX reporting obligations, funs request a change "Report all Lost Account changes" to include "Lost and inactive" account changes

    10.1 Protocol updates

    The Protocol needs to be reviewed and updated to better reflect what is law, versus what is suggested/recommended fund administrative behaviour.

    An example provided was the permanent exclusion rule. The protocol provides guidance that funds should be checking with their members every 5 years to confirm that the permanent exclusion still applies, when the law says the permanent exclusion is permanent. There isn’t enough clarity in the protocol confirming what is suggested behaviour verses what is required behaviour. Funds have subsequently been asked by auditors about the 5 year guidance, as a compliance measure.

    The Protocol needs to be reviewed and updated for better consistency.

    An example provided relates to the permanent exclusion clause for lost accounts. The protocol states on one page that this only related to lost inactive, but then on another page says it counts for lost un-contactable as well. This needs to be clarified to show that the permanent exclusion should count for both inactive and un-contactable.

    Funds would like to see a final version of the process flow for un-contactable accounts included in the protocol, and requested that a similar diagram

    10.2 Updates to the supporting material to be included in the Protocol for un-contactable changes

    An additional example:

    If the fund issues paper mail to the member and receives 2 returned letters, and then subsequently or simultaneously issues an email to the member which is not returned (including situations where the fund can ascertain that the email has been received and opened), legislation dictates that this member should still be classified and reported as Lost.

    This example applies in the reverse situation as well, whereby the returned mail is electronic mail, and the fund has also issued paper mail which has not been returned. In both situations that member should be classified as lost un-contactable.

    Include in Point 2 that contact by the member by any means can also include member answering a phone call, or proactively calling the fund for any reason.

    10.3 Feedback for Treasury

    Funds do not agree (and that it is unfair and against the intent) for electronic returned mail to be able to override paper mail in the returned mail test and vice-versa.  They believe that as long as they have both addresses (electronic and postal), and one of those addresses does not return correspondence unclaimed, then the member should not be classified as lost.

    Sufficient time for industry to implement the systems/process changes in time for 30 June 2016, implementation, especially if the regulations are not enacted until December or even later.

    Funds to provide feedback with examples to the SASG Secretariat mailbox. These will be directed to Jamie Mendyk.

    11 Superstream update

    Ian Colhoun and Tracie Crowden presented an update on the SuperStream changes

    The update summarised the changes to the Enabling Services including the August deployment of the Electronic Portability Form, the enhancements to both SuperTICK for closed accounts and SuperMatch2 as well as returning corrected TFN’s in the EmployerTICK service.

    Ian also spoke about the ongoing consultation to finalise version 2.0 of the Rollover and Contributions Message Implementation Guides. Although the final v2.0 Rollover MIG was published in October, feedback from industry has necessitated a few changes that will result in a republished Rollover MIG prior to Christmas. The draft Contributions MIG is on target for publishing this year with a final expected in the New Year. Both MIGs are still expected to be deployed as scheduled in November 2016 and April 2017 respectively.

    Tracie presented the Member Information eXchange (MiX) project high level design. This project is essentially reforming the current reporting to government transactions for lost members, unclaimed amounts and member contribution reporting.

    SASG representatives were asked to provide any feedback or seek clarification through the SASG mailbox.

    12 Other business

    • Funds are having an issue with the Business Portal slowness and errors they are receiving. Funds will contact the ATO if they are having issues and advised to send compressed files.
    • ATO returning money for incorrectly reported and paid, but no paper work is being received by some funds. Funds will provide examples for us to follow up. We will investigate the cause.
    • Update requested on the LMS and USM software specification
    • ATO issues some letters files via the data transfer facility. At present access is limited to only 2 staff per fund. Funds would like more than 2 staff to have access to the files.
    • Phil McDonald SASG Secretariat retires Friday 13 December 2015 and Loretta Green will become the SASG Secretariat.

    13 Close

    In closing Cathy Cox thanked members for their contribution to a very successful event, encouraging all to consider bringing forward (by email to SASSecritariat@ato.gov.au) significant issues / irritants.

    The next meeting is scheduled for Wednesday 2 March 2015 to be confirmed.

    Action items

    Action item reference

    Issue

    Allocated to

    Completed

    11102015/01

    To circulate the workbook from the workshop on the 23 October 2015 to all SASG representatives. (From agenda item 3)

    SASG Secretariat

    Completed

    11102015/02

    Link to ATO website for Legislative (technical) Issues. Monthly Communique. (From agenda item 4)

    SASG Secretariat

    Completed

    11102015/03

    Design of error message in the future to make sure they align to other messages we currently have on our systems. Not user friendly like ECI. (From agenda item 5)

    Linda Cheesman

    Completed

    11102015/04

    Investigate if BDE can be upgraded to return an error message for the rogue carriage return issue. (From agenda 4)

    Linda Cheesman

    Completed

    11102015/05

    Confirm version usage dates for the MCS specifications from 10.1.0 to 10.1.1 – cutover timeframes for funds (From agenda 4)

    Linda Cheesman

    Completed

    11102015/06

    Review the Release Authority letter (First Paragraph) “Benefit payment to your member so funds staff are having issues with this” (From agenda 6)

    Louie Markovski

    Completed

    11102015/07

    To advise industry that the normal processing of excess concessional contributions will continue up until 24 December Monthly Communique (from agenda 6)

    Louie Markovski

    Completed

    11102015/08

    Send out CRT Alert when we know the dates and what systems will be working during the Christmas break and any other information for the funds. (From agenda 6)

    SASG Secretariat

    Completed

    11102015/09

    Lost Members register (LMR) Re-Report 2016 issue CRT Alert (from agenda 9)

    Shaun Ferabend

    Completed

    11102015/10

    To provide the funds a decision process flow for inactive accounts

    Jamie Mendyk

    Completed

    11102015/11

    Update requested on the LMS and USM Spec

    Shaun Ferabend / John George

    Completed

    11102015/12

    Data transfer facility funds have requested more than 2 staff to be given access

    Linda Cheesman

    Completed

      Last modified: 08 Mar 2016QC 48211