Superannuation Industry Stewardship Group key messages 20 May 2021

Welcome and introduction

Dana Fleming, Acting Deputy Commissioner, ATO, opened the meeting with an acknowledgement to country, welcomed members and noted apologies.

Budget update

Treasury provided an overview of the Budget 2021–22 measures (PDF, 250KB)This link will download a file impacting superannuation.

Treasury are working through plans for consultation timing for all measures and how they will fit within the legislative program.

Superannuation environment and overview

Treasury legislation update

The draft Treasury Laws Amendment (Your Future, Your Super) Regulations is out for consultation with feedback closing on the 25 May 2021.

Transparency of proxy advice consultation will be run by the market conduct division from 1 June 2021.

Further work has commenced on the retirement income covenant. Timing for consultation is yet to be determined.

Kiwi saver amendments will take effect at the end of 2021 and allows the ATO to move unclaimed money directly into kiwi savers accounts.

Australian Prudential Regulation Authority

Consultation around insurance in Super closed 5 March. The Australian Prudential Regulation Authority (APRA) is reviewing submissions received and are looking to finalise the standard and guidance by the second half of 2021.

APRA will release a consultation package shortly on updated Prudential Standard SPS 530 Investment Governance and associated guidance (SPG 530 and SPG 531).

A draft practice guide on remuneration was released for consultation on 30 April and closes on the 23 July.

APRA is preparing for the upcoming pilot for APRA Connect. The test environment will be available in June for entities to familiarise before the production goes live in September.

APRA’s focus this year is on financial resilience, so work is being done on the formulation of a cross industry standard on resolution and recovery which will include superannuation trustees.

Consistent with our focus on financial resilience, we are working towards issuing a discussion paper and an industry survey in the second half of this year in relation to trustee resilience and reserving.

Helen Rowell, APRA Deputy Chair has moved to the insurance sector. The Chair of the Superannuation Industry Stewardship Group (SISG) conveyed her vote of thanks to Helen, for her years of contribution to the SISG and the superannuation industry.

Australian Securities and Investments Commission

Multiple discussions have occurred with industry, including APRA, around the design and distribution of obligations for the regulatory framework that is scheduled to take effect from 5 October.

Consultation on retirement calculators and projection is underway.

Consultation will be undertaken on the anti-hawking regulatory guide, with dates pending due to waiting on regulations.

A voluntary survey for Internal Dispute Requirements was completed. Australian Securities and Investments Commission (ASIC) teams are looking to provide more guidance for complaint resolution processes.

Compliance work is underway regarding whistle-blower obligations and there are opportunities for improvement that will be highlighted.

All non-public offer trustees need licences with ASIC by 1 July 2021 which is on track with a majority having submitted applications.

Licences for public offer trustees, as at 1 January, are in the process of being updated.

Australian Financial Complaints Authority

Professor John Pollaers has been appointed as the new chair of Australian Financial Complaints Authority (AFCA).

An independent review of AFCA was announced in February by the Federal Government. The review is required under the legislation that established AFCA and will be independent of AFCA, with a report due by 30 June 2021.

A review is underway on the approach to fees and charges.

Australian Taxation Office

ATO is focussed on the reuniting your super project relating to wrapping up of Eligible Rollover Fund accounts. All accounts are due to be sent to the ATO by January 2022.

Subject to law passing, the employee stapling tool is on track for 1 July 2021.

ATO is working to ensure the transfer balance indexation cap is ready by 1 July 2021.

Transition to SuperStream rollover v3 (SMSF rollovers and electronic release authorities) has commenced and is mandatory from 1 October 2021.

Single touch payroll is moving into phase 2.

ATO is conscious of the volume of communication and impacts on small business.

ATO is reviewing the third party data governance framework for super funds and is expected to release these principles around late 2021.

Other business

Modernising Business Registers project

The chair provided a brief update from the Modernising Business Registers (MBR) program.

The MBR program will establish a new modern registry service. The Australian Business Registry Services (ABRS) will bring together the Australian Business Register and 31 Australian Securities and Investments Commission registers in one place.

The project is still in private Beta testing with more communication to be released later this year.

The program will:

• progressively roll out between 2021 and 2024
• introduce director identification numbers (director ID) – a unique identifier that a company director will keep forever.

Director ID will apply to the directors of a corporate trustee of a superannuation fund.

Super guarantee

A six-month review post amnesty period has been completed.

The ATO is looking to revise the policy framework for Part 7 Penalty remission to ensure our settings are pragmatic, fair and take into account all positive behaviour that an employer may make towards meeting their super guarantee obligations.

Attendees

Guest attendees

Apologies