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  • SISG key messages 10 March 2016

    Executive summary

    The Superannuation Industry Stewardship Group (SISG) met in Melbourne on 10 March 2016 for its first meeting of the year.

    The Chair, ATO Superannuation Deputy Commissioner James O’Halloran opened the meeting.

    Apologies were noted and new members and invited guests were welcomed:

    • Dante De Gori – Dante has taken over from Mark Rantall as CEO Financial Planning Association of Australia and will be the SISG representative going forward.

    Other announcements

    • The Chair advised members that all ATO consultative forums have undergone a name change and this group (Superannuation Industry Advisory Group) will now be referred to as the Superannuation Industry Stewardship Group (SISG).
    • This was supported and accepted by the members.

    Minutes of the 30 November 2015 meeting were accepted and action items closed.

    The chair then welcomed the Hon Kelly O’Dwyer, Minister for Small Business and Assistant Treasurer to the meeting.

    Agenda topics discussed included:

    Objective of superannuation

    The Hon Kelly O’Dwyer, Minister for Small Business and Assistant Treasurer attended the group as part of the government’s consultation process on the objective of superannuation.

    The Minister discussed the government announcement of 9 March 2016 relating to seeking community feedback into the objectives of superannuation. (Objective of Superannuation discussion paper)

    Members discussed the importance of finding a way to define the objectives of superannuation and codify the objectives. Most members suggested that they are likely to make a submission or take part in the consultation.

    The Minister recognised the forum as it brings together an industry view from a range of perspectives.

    Treasury and regulators update

    Helen Rowell Deputy Chair, APRA provided an update on policy and supervision related areas of focus for APRA:

    • Reviewing the guidance around successor fund transfers
    • Increased focus on improving reporting and data quality

    Jenny Wilkinson, Division Head, Treasury provided an overview of the government’s Objective of Superannuation review and the context and consultation arrangements for the announcement.

    • The paper is open for public consultation and is designed to start the process for meeting the government's commitment to enshrine the objective of superannuation in law. Submissions close 6 April 2016.
    • It was noted an update on the progress of the review will be provided at the June SISG meeting.
    • Work is continuing to progress other elements of the government’s response to the Financial System Inquiry with a discussion paper expected to be released identifying some of the key policy issues. Treasury also advised that there are two pieces of legislation being introduced to parliament over the next couple of weeks:
      • Extending choice of fund
      • Transparency measures. The draft regulations have been released. Treasury will continue to consult on this measure.
       

    Women in superannuation

    Andrea Slattery, Chief Executive Officer SMSF Association presented a paper on the findings from a study conducted by Galaxy Research to better understand the dynamics of the SMSF market with a key objective to examine the difference in behaviours, confidence and market outlook between women and men.

    Members reflected on the key findings outlined in the paper and discussed a number of areas including the differences of how men and women engage in their SMSF and the need to understand the impacts of significant life events of an SMSF trustee.

    The group discussed the Senate Committee inquiry into the economic security of women in retirement and the recent public hearings.

    It was noted that the ATO is happy to work in partnership with industry to support initiatives that increase awareness and engagement of women in the superannuation system.

    Superannuation into the future

    Deputy Commissioner James O’Halloran lead a discussion on Superannuation into the future.

    The purpose of the discussion was for members to share views on possible reform proposals covering considerations, impacts, assumptions and key design elements or impacts. The conversation centred around the effectiveness and sustainability of the superannuation system.

    Members discussed the importance of a whole of government approach to how superannuation services are provided. Of equal importance is ensuring we give consideration to past experiences and learnings as we develop the superannuation system and technologies going forward.

    Special mention was given to Greg Tanzer, CEO ASIC, Chris Jordan, Commissioner of Taxation and Kasey Macfarlane, Assistant Commissioner Superannuation at the SMSFA Conference which was held on 1719 February 2016.

    It was appreciated by the group that there was a range of public media on approaches to Superannuation that still needed to move forward or be confirmed that made this conversation an important item to bring back to the group in future meetings, as clarity was gained on government directions.

    Commissioner's proposed remedial power

    Deputy Commissioner James O’Halloran briefed members on the proposed remedial power to be legislated for the Commissioner of Taxation.

    The proposal will allow the Commissioner to make administrative decisions where policy intent is unclear, while remaining consistent with the law and any budget impact will be negligible.

    The change will ultimately give the Commissioner the ability to deliver services more effectively.

    Any potential use of the power will be open for public consultation prior to it being exercised.

    It was noted this measure was still going through the legislative process.

    SuperStream and Single Touch Payroll progress report

    Philip Hind, National Program Manager ATO and John Shepherd, Assistant Commissioner ATO provided an update on SuperStream and Single Touch Payroll:

    • As at the end February 2016 approximately 500,000 employers, including more than 400,000 small employers, are now SuperStream compliant. This represents nearly 65% of the total employer population and about 60% of small business employers.
    • There are now more than 117,000 employers using the Small Business Superannuation Clearing House as a way of meeting their SuperStream obligations. Registrations have been growing at 15% compound per quarter for nearly 18 months. The ATO will be launching a major communications campaign to small business during May 2016 to build on this momentum.
    • Approximately 85% of all contribution transactions received by APRA funds from employers were SuperStream compliant at December 2015. Projections indicate this will reach 95% compliance by 30 June 2016 with only the ‘tail’ of small businesses to deal with.
    • The ATO is committed to ensure the necessary degree of continuity in managing the balance of SuperStream given the investment of industry as well as the overlapping population and stakeholders that are central to the completion of SuperStream and the emerging developments in Single Touch Payroll.
    • In order to facilitate the appropriate continuity, build on established relationships and ensure alignment of the projects, the governance will bring them together under one program of work. Assistant Commissioner John Shepherd will take the role of Project Lead for Single Touch Payroll and the governance of SuperStream.

    Other business

    Deputy Commissioner, James O’Halloran spoke to the Terms of Reference for the Productivity Commission review into the competitiveness and efficiency of the superannuation system that has been recently released.

    It is the ATO’s understanding that the Productivity Commission will issue an Issues Paper to assist in the preparation of submissions which will be released soon. (Productivity Commission Superannuation Competitiveness and Efficiency - issues paper)

    Deputy Commissioner, James O’Halloran advised that the ATO conducts an annual environmental scan on the superannuation social and economic environment in the form of a macro level report to guide our thinking into 2016/2017.

    The ATO will seek input from interested members in the coming weeks on the Superannuation Performance and Directions document.

    Chair, James O’Halloran thanked members for their contribution to the discussion.

    Next Meeting

    Monday 1 August 2016 in Sydney.

    Attendees

    Australian Taxation Office

    James O’Halloran, Deputy Commissioner, Superannuation (Chair)

    Philip Hind, National Program Manager, Superannuation

    Emma Tobias, Assistant Commissioner, Superannuation

    John Shepherd, Assistant Commissioner, Superannuation

    Kasey Macfarlane, Assistant Commissioner, Superannuation

    Sarah Kimmorley, Senior Director, Superannuation

    Tammie Turner (Secretariat)

    Guest

    The Hon Kelly O'Dwyer, Minister for Small Business and Assistant Treasurer

    Treasury

    Jenny Wilkinson

    Michelle Dowdell

    Australian Prudential Regulation Authority (APRA)

    Helen Rowell

    Carolyn Morris

    Australian Securities & Investment Commission (ASIC)

    Alex Purvis

    Australian Chamber of Commerce and Industry (ACCI)

    Dick Grozier

    Australian Institute of Superannuation Trustees (AIST)

    David Haynes

    Association of Super Funds Australia (ASFA)

    Glen McCrea

    CPA Australia

    Paul Drum

    Chartered Accountants Australia and New Zealand

    Tony Negline

    Financial Planning Association of Australia (FPA)

    Dante De Gori

    Industry Super Australia (ISA)

    Zak May

    Law Council of Australia

    Heather Gray

    Mercer

    David Knox

    SMSF Association

    Andrea Slattery

    Apologies

    Australian Bankers' Association (ABA)

    Diane Tate

    Association of Super Funds Australia (ASFA)

    Pauline Vamos

    Australian Institute of Superannuation Trustees (AIST)

    Tom Garcia

    Financial Services Council (FSC)

    Andrew Bragg

    Industry Super Australia (ISA)

    Robbie Campo

     

      Last modified: 26 Jul 2016QC 49716