Show download pdf controls
  • SASG key messages 17 April 2019

    Welcome and opening remarks

    • Assistant Commissioner, Jason Lucchese, opened the meeting and welcomed all those in attendance.
    • The key messages from the 21 November 2018 meeting were accepted.

    Context setting post budget announcements

    • Jason Lucchese provided context around the recent Budget announcements and advised the group the ATO was now in caretaker mode. The message provided for industry was that we can continue to consult on the implementation of measures that have received legislation and has been passed, however we cannot consult on unenacted measures until the outcome of the Federal election is known. It was noted that when a new government is known, it is the role of the agency to brief the incoming Minister on any matters that need to be brought to attention and any impacts to key critical dates.
    • It was acknowledged that over the past 12 months there has been a lot of change across the super landscape particularly in regards to event based reporting with 94% of MATS onboarding completed by the end of March 2019, which represented 90% of all members. Jason extended his thanks to all involved in making this a success.
    • As event based reporting moves to being normalised, the ATO has commenced looking at what this means from a diagnostic reporting perspective. A small working group has been established to work through what the diagnostic reporting might look like.

    Protecting your Super Package

    • Graham Whyte provided an update on the Protecting Your Super Package.
    • The ATO has been consulting with industry, APRA, and Treasury on the new legislation. These changes have resulted in the creation of a new category of Unclaimed Super Monies (USM), also known as inactive low balance accounts.
    • As a result of consultation an issues log has been created; 22 areas have been identified as requiring further clarification, as well as Frequently Asked Questions (FAQ’s) which will be published on the ATO website.
      Note: the latest version of the issues log was sent to all members of the SASG during the meeting.
    • ATO will be updating the USM protocol to include this new type of USM category and is expected to be shared with industry after the Easter break.
    • ATO will be writing to all trustees to share the opt out declaration form, which will include a preamble, instruction guide and landing page. Funds will be able to use this form or alternatively funds can develop their own form. ASIC have also provided guidance on the guide.
    • Funds can lodge their own form via the business portal, however will need members authorisation to act as their agent prior to lodging the form on their behalf.
    • One of the priority issues discussed was the fund identification of inactive and low balance accounts. The ATO view is when determining if an amount meets the definition of an inactive low balance account is in accordance with section 20QA of the SUMLMA some tests are applied at the product level not an aggregated account level.
    • Members discussed some of the complexities with implementing this and concerns were raised that the legislation would result in a poor member experience. The ATO’s proposed practical compliance approach that would allow funds an additional six months to implement the ability to apply tests at product level was discussed. Further consultation is expected on this issue as well as a practical compliance approach for a 6 month reporting period extension.
    • The ATO to include the issues around the MySuper Product definitions and the timing impacts for the Successor Funds Transfers in the issues log and provide an updated issues log to SASG members.
    • While the law provided for the regulations to prescribe conditions of release that would mean an account is not an inactive low-balance account, no such regulations were made. The ATO has consulted with Treasury and provided a list of relevant conditions of release which if met, a fund can take to exclude an account from being an inactive low-balance account. A reminder to all committee members that any queries or issues on the topic can be sent to pysproject@ato.gov.au.

    Action item update

    Action item

    17 April 2019-1

    Due date

    May 2019

    Responsibility

    ATO - Graham Whyte and Pamela Cooke

    The ATO to provide SASG members with a copy of the draft Member Declaration Form and the Design Solution document which maps out a process for Channel A and B.

     

    Action item

    17 April 2019-2

    Due date

    May 2019

    Responsibility

    ATO - Graham Whyte and Pamela Cooke

    The ATO to provide SASG members with an updated issues log that includes details on the definitions of the MySuper Product.

    Secretariat note: Action item 17 April 2019-1 response - The draft Member Declaration Form and a design Solution Document were provided to members at the time of issuing the key messages.

    A package of documentation in relation to this measure has been published at https://lets-talk.ato.gov.au/SuperCommunity/news_feed/protect-your-superExternal Link.

    Extension of SuperStream rollovers to SMSF's

    • Tracie Crowden provided an update to the group regarding the progress of the SuperStream rollovers to SMSFs and the changes arising from the 2019 Budget. It was reaffirmed that the ATO is now in caretaker mode and until any law on the proposed measures is enacted by parliament, 30 November 2019 remains the current legislated date.
    • If the change to include release authorities in the SMSF rollover standard is enacted, this will mean the full package of changes including the originally legislated extension of SuperStream rollovers to SMSFs and smaller design changes including death benefits will be delayed until March 2021.
    • It was noted as per current law, APRA regulated funds have a transition period to April 2020. There is a need to ensure this message is also reaching service providers.
    • If the proposed measures become enacted, the ATO will work with impacted stakeholders as more information becomes available.
    • The updated message structure tables, which will include the changes discussed at the CDT around itemising the different technical elements, will be published to ato.gov.au on 18 April 2019.
    • The validation rules and response codes, EVTE code and C# code artefact package are on track to be published in July 2019.
    • The ATO are on track to provide a testing environment for the SMSF member tick and the SMSF verification services.
    • The Q&A templates continue to be produced and the outstanding design considerations continue to be worked through.
    • Members of the SASG were encouraged to attend the Digital Service Providers (DSP) webinar on the 30 April 2019 which would look at the impact on DSP’s if any of the proposed budget measures were enacted.
    • The ATO will work with industry as more information becomes available.

    Secretariat note: The Digital Service Providers webinar was subsequently postponed until 22 May 2019.

    ATO Online Display

    • Tim Pulsford and Blair Lauchlan provided an update on the enhancements to ATO online for super members. The Q1 release was deployed in March 2019 provides members with greater visibility of data through MAAS, MATS and STP.
    • Positive feedback was received on the webinar conducted with industry in Q1. A link to the recording is available at Webinar for Super ATO OnlineExternal Link.
    • As a result of the enhancements some defects/ issues were discovered. A total of 90% of defects have been resolved with 10% remaining. The ATO is working towards resolving these prior the Q2 deployment.
    • The ATO is continuing to progress the Q2 June 2019 deployment including developing the screen shots for the new features which hope to be available in the coming weeks.
    • The ATO is also preparing a communication package to support the Q2 deployment including a webinar is currently being organised which will enable attendees to see all the new screens and features. This information will be shared through the Communication Reference Group.
    • Feedback was provided on incorrect SG information being displayed online. ATO advised to send specific details to the Blair Lauchlan for further investigation.
    • Feedback was also provided on the screen messaging for Defined Benefit members and that it could be confusing or misleading. ATO agreed to look into this further and advised all feedback is welcome in order to improve member experience.
    • The group discussed the availability of MATS SG information that was part of the Q1 deployment noting no significant issues have been identified.

    Action item

    17 April 2019-3

    Due date

    May 2019

    Responsibility

    ATO - Tim Pulsford and Blair Lauchlan

    Tim Pulsford and Blair Lauchlan to confirm if there is a CSC representative on the Communication Referencing Group meeting.

    Secretariat note: Action item 17 April 2019-1 response – While the ATO communicates with CSC regarding the ATO Online display work, there is currently no CSC representative on the Communication Reference Group.

    Super Guarantee Integrity Measures

    • Gavin Hayhurst provided an update on the Super Guarantee (SG) Integrity Measures. The law commenced on 1 April 2019 and is intended to improve the integrity and administration of SG through targeted reforms.
    • The law will allow the Commissioner to:
      • direct an employer to undertake an approved course of education
      • remove the 3 month period before director penalties are ‘locked down’ in respect of unpaid SG liabilities
      • apply for a court order to compel entities to comply with a security deposit
      • direct an employer to pay any outstanding SGC liability
      • inform employees and former employees of SG shortfalls identified or reasonably suspected
    • The measures are part of a broader ATO program to improve visibility and compliance of SG.
    • Discussion was held on directing an employer to complete a course to improve knowledge of their employer obligations. The course is available on the ATO website and completion is also voluntary.
    • The ATO welcomes industry feedback on the course and whether this is something funds would be interested in promoting with employers. The ATO is interested in courses that focus on SG obligations and cash flow management – the two areas that can impact through to SG payments for employees. The ATO can consider and approve courses produced outside the ATO for use.
    • Discussion was held on whether the deferral process for STP would interfere with the legislation to direct employers to complete the course. ATO advised we can identify high risk employers through other risk models and direct them to undertake the course.

    Action item

    17 April 2019-4

    Due date

    May 2019

    Responsibility

    ATO - Gavin Hayhurst

    The ATO to provide links to web content for the education courses that focus on Super Guarantee employer obligations.

    Secretariat note: Action item 17 April 2019-5 response - The links to web content for the education course that focus on Super Guarantee employer obligations are provided below.

    Super guarantee employer obligations course (landing page)

    https://www.ato.gov.au/Business/Super-for-employers/Working-out-if-you-have-to-pay-super/Super-guarantee-employer-obligations-course/

    SG employer obligations education course

    https://www.ato.gov.au/Business/Super-for-employers/In-detail/SG-Employer-obligations-course

    Invitation to submit a course for approval and use

    https://www.ato.gov.au/Business/Super-for-employers/In-detail/Approval-of-superannuation-education-courses/

    To provide feedback or for any questions contact:

    Gavin Hayhurst

    Director | Engagement & Assurance
    Superannuation & Employer Obligations
    Australian Taxation Office

    Gavin.hayhurst@ato.gov.au

    P 08 7422 2691

    First Home Super Saver (FHSS) scheme

    • Reece Parry provided and update on the FHSS.
    • The ATO has received queries from funds about suspicious looking release authorities. If there are any concerns about possible fraud on release authorities, funds should email Super CRT (sprcrt@ato.gov.au).
    • Members raised concerns about the response timeframes for items sent to the Super CRT mailbox for actioning. Members were advised to include the reference ‘COMP’ at the start of the subject line in the email to Super CRT to ensure the highest priority is given to the request.
    • A reminder was given to funds that the absence of contributions in an account was not necessarily fraud, as the contributions might be made to a different super account.
    • SASG members advised that providing them with scenarios of potential suspicious release authorities would be helpful in identifying whether there was fraud present.
    • ATO advised we would be working on this issue and will be sharing with the group the steps funds need to take in identifying a potential fraud situation in regards to a FHSS.
    • A reminder was given to funds that once a FHSS release authority was requested by a member, a member cannot change their mind but could recontribute the amount back to super within the specified time under the legislation.
    • Amendments to the FHSS law were discussed. There are three changes to the operation of the scheme:
      • can only be used for Australian property
      • contract to buy or build can be signed up to 14 days before submitting a FHSS release request
      • the 12 month period to sign a contract or recontribute is now calculated from the date of the release request (previously it was from the date of the first FHSS amount being released by the ATO).
    • The amendments to the law are effective from 1 July 2019 but the law will be applied retrospectively from 1 July 2018.
    • The ATO is updating guidance material and will provide details to industry once available.

    Compassionate Release of Super (CRS)

    • Reece Parry provided an update on the CRS.
    • The ATO is working on technical interpretation of the law in regards to the correct tax treatment for CRS releases. Further advice will be provided to funds on this in the coming weeks.
    • ATO advised that letters presented by an individual when seeking a CRS release, doesn’t need to contain the same address on the fund’s system in order to release the super. In many cases for tax purposes an individual will have a different address such as a tax agent’s address.
    • The ATO is continuing to work on an update to BDE file name to include the fund ABN or USI so funds won’t need to open each file. The ATO advised there is a potential solution being worked through. The timeframe to complete this work is to be confirmed.
    • The ATO is receiving some calls from individuals regarding applications for severe financial hardship. Funds are reminded requests or queries need to be directed to Department of Human Services and not the ATO.

    Action item

    17 April 2019-5

    Due date

    May 2019

    Responsibility

    ATO - Reece Parry

    The ATO to provide a more indicative timeframe for when the BDE solution to reduce the manual process to extract BDE notices from the portal to forward to the correct fund will be implemented

    Secretariat note: Action item 17 April 2019-6 response - A solution for including the fund name, USI, and/or ABN in the file name for Compassionate Release of Super (CRS) notices sent to funds via BDE has been confirmed. There is a character limit for the BDE file name which will impact on the final information that can be included in the file name. This change will need to be delivered as part of our quarterly release cycle – we are aiming to get this change into the September 2019 release. A further update will be provided at the next SASG meeting.

    Downsizer Contributions into Superannuation

    Paper was noted as read.

    Transfer Balance Cap

    • Helen Morgan provided an update on the Transfer Balance Cap and how the operation and administration of the measure is functioning now that more funds have onboarded to MATS environment.
    • The ATO advised when a funds report a MATS retirement phase event, ATO generates an internal transfer balance account form in our system to allow the ATO to store and consume the information that has been reported.
    • There are a number of particular scenarios which could result in this form suspending. The ATO is working to better understand why these forms are suspending in the new environment so that appropriate business processes can be actioned to resolve the issue.
    • The ATO confirmed direct contact shouldn’t be made to funds regarding suspended forms . The ATO has processes in place to quarantine this work and limit contact with funds, however if funds are being contacted they should advise the ATO via the CRT mailbox to report any issues.
    • The ATO is taking a risked based approach to resolve any issues and minimise any impact to industry. Further analysis of the data is being undertaken and the group discussed if funds could view a data set it could help identify if there is a simple issue at the fund end that could be easily resolved.
    • The ATO will work directly with impacted funds to resolve any suspended form issues.

    Risk Differentiation Framework 2018 update and redesign

    • Rosette Singh provided the group with the key industry insights from the 2018 Diagnostic reports and the work underway regarding the RDF redesign.
    • In summary there were 220 large funds in total; there was a reduction in the number of key clients that had high consequence ratings. The majority of funds were classified as low consequence (192 of 220).
    • A select group of funds received draft results and were provided with an opportunity to provide feedback. The final reports are scheduled to be issued by 26 April 2019.
    • With the implementation of event based reporting, the ATO is looking at redesigning some of the indicators and identifying key statistics. A new framework is currently being explored which will compare funds with their peers and deliver meaningful information that reflects the funds approach and process to meeting members reporting obligations.
    • It was noted the redesign is a fundamental shift in terms of how this information can be used for assurance purposes in fund reporting and how we can share this data with funds on a timelier basis.
    • Further work is being undertaken to develop an agreed set of measures to provide better insight in to how the system is performing in operation and how we can influence and change behaviour.
    • An external co-design consultation group has been established to work through the new RDF redesign. Key messages from this group are published via Superannuation-Diagnostic-Report-for-large-APRA-funds.
    • Feedback was provided regarding some skewed results on a draft diagnostic report. As part of the redesign process will allow the ATO better understand Fund processes and how the data is synthesised before it is reported to the ATO to ensure the right connections are being made.
    • The ATO will provide further commentary with regard to any impacts resulting from the transition between the MCS and MAAS reporting to lost member accounts.
    • The ATO will be exploring a variety changes and improvements as part of the RDF redesign process through the co-design consultation working group including more frequent reporting back to funds, opportunities to share statistical data, increase trustee confidence around system assurance and accuracy.
    • Members agreed there continues to be value in the RDF aside from what format or shape it take into the future.

    Action item

    17 April 2019-6

    Due date

    May 2019

    Responsibility

    ATO - Rosette Singh

    The ATO to provide SASG members with the key messages from the latest Risk Differentiation Framework (RDF) re-design meeting held on the 27 March 2019.

    Secretariat note: Action item 17 April 2019-7 response - The key messages from the Risk Differentiation Framework (RDF) re-design meeting held on the 27 March were provided to members at the time of issuing the key messages.

    Event based reporting deferrals, reconciliation and assurance

    • Larissa Evans provided an update on the implementation status of MATS deferrals and MAAS and MATS reconciliation activities.
    • 94% of funds have onboarded to MATS by the compliance date. A small number of funds have deferrals in place with the latest deferred date for any deferrals being 30 June 2019.
    • The ATO has been actively working on the data reconciliation with funds to identify and rectify any reporting errors in their initial foundation data load as well as working with funds to remediate issues caused from continued SuperTICK usage. A reminder to funds not to use SuperTICK post MAAS onboarding.
    • Funds are also reminded to complete their MAAS foundation data remediation activities. This is resulting in downstream impacts to members.
    • It was noted that some employer details are not being reported. Funds are reminded where they have employer details to ensure all employer details are reported. The ATO assumes the absence of employer data means that the fund doesn’t have them.
    • The ATO is starting to get insights from representatives across industry regarding lodgment patterns and volumes. The ATO is looking to write to trustees to get a better understanding what their MATS annual balance reporting volumes will look like over the July 2019 – October 2019 period.
    • Discussion was had on batch sizes, the 100k batch sizes are still working however the group noted there is still a 10-15min delay when reporting a new batch. The ATO is looking into solutions to reduce the delay between each data load.
    • Further conversations will need to occur with industry, DSPs and Gateways around what solution the ATO will need to consider with regard to system capacity from an end to end perspective.
    • Members discussed how the ATO uses the grandfathering indicator/flag. It was noted the CRT Alert 25/2019 includes information on the process required to update the grandfathering attribute status.
    • It was noted that the ongoing reconciliation work completed by the ATO has been very effective and helpful for funds.

    Secretariat note: The Trustee letter regarding completion of MAAS and MATS as well as the MATS annual reporting template was issued to industry on 2 May 2019.

    Single Touch Payroll including Employee Commencement

    • Ian Colhoun provided an update on Single Touch Payroll (STP) including Employee Commencement.
    • In February 2019, Parliament passed legislation to extend STP reporting to all employers from 1 July 2019.
    • The ATO will take a pragmatic approach to onboarding small employers to STP.
    • The ATO consulted with small business, industry and tax professional and conducted a pilot. The pilot highlighted the need for different approaches for different employer groups. Some considerations that aim to support the different markets include:
      • a low cost product for micro employees
      • grant deferrals for employers that require more time to commence reporting
      • no penalties for small employers making a genuine attempt to comply
      • no penalties in the first year
      • provide exemptions for employers experiencing hardship
      • allow quarterly reporting options for micro employers to report STP at the same time as they lodge their BAS.
    • There are 80,000 employers are already engaged and reporting through STP, of this population 30,000 are small employers. This equates to 5.7 million individuals.
    • The ATO has written to all small employers advising of the changes including advice on what to do where an employer requires further time to start reporting beyond 30 September 2019. This is part of a flexible deferral exception framework has been put in place supported by new functionality of the online portal.
    • There are two services available in the market for employee commencement, a software service and individuals using ATO Online. A paper is being developed to show the user pathway for ATO Online.
    • The ATO is looking at what a full wholesale employee commencement service might look like by September 2019.

    New Superannuation Services Dashboard

    • Ty Winmill provided an overview of the new Superannuation Services Dashboard. The new dashboard was released on 11 April 2019 replacing the existing one. The dashboard is the primary channel used to communicate directly with funds.
    • A fund can register to subscribe to any of the services in order to receive updates.
    • A user guide is expected to be published in the coming weeks.
    • Any questions about the dashboard or issues experienced should be sent directly to the SuperStream Standards mailbox.
    • Positive feedback was received from industry noting the dashboard has been extremely useful.

    Successor Fund Transfers (SFT)

    • Larissa Evans sought feedback from SASG members on how the ATO and industry can work together to support successor fund transfers within the industry.
    • The ATO expects there will be an increase in successor fund transfers and is seeking input and feedback from industry on ways we can improve engagement during SFT activity.
    • Members discussed some complexities particularly around lost and unclaimed super reporting.
    • It was noted that the SFT protocol document was put together early on prior to MAAS and MATS implementation and requires reviewing. It was agreed that a smaller group would be convened to review the SFT Protocol document.
    • Some issues were also raised through the SuperStream Technical Committee that may need to be incorporated and considered.

    Action item

    17 April 2019-7

    Due date

    May 2019

    Responsibility

    ATO - Larissa Evans

    The ATO to convene a small working group to review the SFT Protocol document.

    Secretariat note: Action item 17 April 2019-8 response - A short term special purpose working group has formed. Outcomes will be shared with the broader industry.

    APRA fund client experience survey

    • Larissa Evans provided an update on the client experience survey findings, noting there were 103 respondents. The survey findings have provided useful insights for the ATO:
      • 96% of participants are using ATO products
      • ato.gov.au was the most common source of superannuation information
      • 62% of participants were satisfied with the ATO products, however it was also noted that the search function could be improved
      • Documents in PDF format was the preferred option.
    • As part of a broader engagement piece of work, the next step in evaluating how funds interact with the ATO will include a series of contextual interviews to be undertaken. The ATO to confirm details when they become known.
    • It was noted the frequency and timing of the survey will change to twice a year, in March and September and be open to complete for one month. The first redesigned survey is planned for September 2019.

    Future arrangements of the SASG

    • Jason Lucchese advised members that the Superannuation and Employer Obligations business line is currently undertaking a review of all industry consultative and committee arrangements to ensure all arrangements are still fit for purpose.
    • The intention of the review is not to limit or reduce our consultation and co-design with industry but to ensure we have groups that are targeted and focused.
    • Discussion was had on what the future committee arrangements might be noting the SuperStream Reference Group has closed and the Superannuation Industry Stewardship Group will continue as the ATO’s peak consultative group.
    • It is proposed a number of special purpose groups with a limited life will be established that will have a specific and targeted scope, for example ATO Online.
    • The SASG would focus on looking at the system in operation from an administrative and continuous improvement perspective.
    • Members discussed the need to ensure a channel remains available to raise and discuss any exceptions and escalations. There also needs to be clearer communication on what the committee and consultation arrangements the ATO has or will have in place going forward.
    • The ATO welcomed input from members with regard to what is / isn’t working and suggested it would be valuable for industry to bring forward their key issues for discussion at future SASG meetings.
    • It is anticipated the new arrangements will commence from July 2019.

    Attendees

    Organisation and name of attendees.

    Organisation

    Members

    ATO

    Jason Lucchese

    ATO

    Catherine Johnston

    ATO

    Jess Hipsley

    ATO

    Graham Whyte,

    ATO

    Ty Winmill

    ATO

    Larissa Evans

    ATO

    Rosette Singh

    ATO

    Tracie Crowden

    ATO

    Helen Morgan

    ATO

    Reece Parry

    ATO

    Tim Pulsford

    ATO

    Blair Lauchlan

    ATO

    Pamela Cooke

    ATO

    Gavin Hayhurst

    ATO

    Ian Colhoun

    ATO

    Tammie Turner

    ATO

    Lucy Mrak

    AMP

    Kelly Kerr

    ANZ

    David Delaney

    ANZ

    Edwins Fung

    ASFA

    Fiona Galbraith

    BT Financial

    Martin Mikulicin

    Bravura Solutions

    Sam Finucan

    CBA

    Adam Wright

    CBA

    Ari Gerasimou

    Colonial First State

    May Low

    CSC

    Gareth McAlister

    IOOF

    Chloe Continenza

    IOOF

    Heide Stewart

    Link Group

    Sue Pearce

    NAB

    David Kerr

    NAB

    Ian Roberts

    OneVue

    Meegan Punch

    OneVue

    Warren Heighway

    QSuper

    Catherine Best

    Super SA

    Darren Cox

    Sunsuper

    Ben Sommer

    Sunsuper

    Matthew Pritchard

    Syncsoft

    Mary Gale

    UniSuper

    George Strilakos

    UniSuper

    Warren Liang

    Zurich

    Maria Anislag

      Last modified: 19 Jun 2019QC 59389