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Superannuation Industry Stewardship Group key messages 13 September 2023

Key topics discussed at the Superannuation Industry Stewardship Group meeting 13 September 2023.

Published 5 November 2023

Welcome and introductions

Co-chair David Knox opened the meeting with an Acknowledgement of Country. Acting Deputy Commissioner for Superannuation and Employer Obligations Usha Narain was introduced as ATO co-chair.

Integrity declaration

The ATO provided an update on the integrity declaration for stewardship groups. The integrity declaration is a risk management control that will reinforce high standards. It will be signed on an annual basis and is designed to complement the group charter. The integrity declaration will be issued to members shortly.

Superannuation regulators


The Treasury Laws Amendment (Measures for Consultation) Bill 2023: Non‑arm’s Length Expense Rules for Superannuation Funds has been introduced and is before the House of Representatives. Changes apply to income derived in the 2018–19 income year or a later, but not to expenses incurred or expected to have been incurred prior to 1 July 2018.

The Treasury Laws Amendment (2023 Measures No. 3) Bill 2023 has passed both Houses.

Treasury provided an overview of current and upcoming consultation:

  • Consultation on the Better targeted superannuation concessions exposure draft will commence later in 2023.
  • The Legislating the objective of superannuation consultation process is open until 29 September 2023.
  • The Review of the regulatory framework for managed investment schemes consultation process is open until 29 September 2023.
  • Roundtable discussions are underway regarding the Quality of advice review. The government expects to issue a final response later in 2023.
  • The Treasurer has announced upcoming consultation on the retirement phase of superannuation. Consultation will explore the role of government and superannuation funds in retirement.

Australian Prudential Regulation Authority

The Australia Prudential Regulation Authority (APRA) Corporate Plan 2023–24External Link has been released. Key areas of focus are transparency, retirement strategy and outcomes, and cyber risks in superannuation.

The results of the Annual superannuation performance test 2023External Link have been released. APRA will perform supervisory follow-up with trustees on failing products.

APRA provided an overview of current policy reform activities:

  • CPS 230 Operational risk management will commence from 1 July 2025. Consultation on the draft Prudential practice guide CPG 230 to accompany the standard will close on 13 October 2023.
  • A letter has been sent to all APRA-regulated entities with a summary of findings from the CPS 511 Remuneration pre-implementation review.
  • SPS 515 Strategic planning and member outcomes will be released shortly.
  • Further consultation on SPS 114 Operational risk financial requirement will take place in early 2024.

Australian Securities and Investments Commission

The Australian Securities and Investments Commission (ASIC) ASIC Corporate Plan 2023–27 (PDF 4,445MB)This link will download a file has been published. It outlines the following agency priorities:

  • Product design and distribution – Reduce the risk of harm to consumers of financial and credit products, caused by poor product design, distribution, and marketing, especially by driving compliance with new requirements.
  • Sustainable finance – Support market integrity through proactive supervision and enforcement of governance, transparency, and disclosure standards in relation to sustainable finance.
  • Retirement decision making – Protect consumers, especially as they plan and make decisions for retirement, with a focus on superannuation products, managed investments, and financial advice.
  • Technology risk – Focus on the impacts of technology in financial markets and services, drive good cyber-risk and operational resilience practices, and act to address digitally enabled misconduct, including scams.

Supporting ASIC priorities are a set of core strategic projects. Projects on scams, sustainable finance practices, design and distribution obligations, cyber and operational resilience may be relevant to Superannuation Industry Stewardship Group members.

Superannuation–specific pieces of work include the choice products project, a project on improving the delivery of member services and looking at cold calling and superannuation switching. Work in relation to financial advice includes adviser registration.

Consultation on the Financial Accountability Regime (FAR) is about to commence. Guidance for approved deposit institutions will be issued shortly and it is recommended the broader superannuation industry review this advice. The FAR is designed to improve risk and governance cultures of all APRA-regulated entities by imposing a strengthened responsibility and accountability framework for those financial institutions.

Australian Financial Complaints Authority

The Australian Financial Complaints Authority (AFCA) has released high–level statistics for the 2022–23 year:

  • 6,957 superannuation complaints were received
  • superannuation complaints increased by 32%
  • delays in insurance claim handling, including payment in life insurance and total and permanent disability claims within superannuation, increased by 136%
  • complaints relating to death benefits have tripled.

Complaints for 2023–24 have already surpassed the forecast number. AFCA is allocating additional staff to respond to the surge and is proactively engaging with member funds to try and keep ahead of complaints.

Work on an IT transformation project which will streamline the case management system and communication with AFCA is ongoing. The launch is expected in late March 2024.


Superannuation guarantee (SG) integrity is a key focus area of the ATO Corporate Plan 2023–24. The ATO is expanding its use of data to identify behaviours that drive non-compliance. This will:

  • create more transparency by providing a consolidated view of SG liabilities and payments for each employer–employee relationship
  • optimise the use of data to help employers understand how and when payments got off track for their employees
  • lead to the development of nudge correspondence to support employers to self-correct SG issues and keep track of obligations – this is expected to assist employers to lodge SGC statements when required.

Funds and employers should ensure superannuation reporting and payments are timely, accurate and complete.

Illegal early access estimate

Illegal early access (IEA) is a key risk in the self-managed superannuation fund (SMSF) system. IEA undermines the superannuation system and increases reliance on government-funded pensions.

The ATO is working on an estimate of IEA to measure the size of the risk and develop a better understanding of levels of compliance. The estimate will help identify drivers of non-compliance and provide a baseline to measure effectiveness of controls and risk treatments.

The methodology developed is like the tax gaps measure used by the ATO. Once in place, the IEA estimate will be measured annually to monitor trends over time.

There will be an in-confidence briefing for key industry groups in late 2023–early 2024, with a public release of information to follow.

Updates to

The delivery of upgrades to is expected in December 2023. Public beta testing is due to commence in early November. Members are encouraged to explore the updated website when it is available and provide feedback.

There will be changes to how superannuation information is presented, with navigation options updated to 3 audience segments:

  • Individuals and families will contain superannuation information for individuals.
  • Businesses and organisations will contain superannuation information for employers.
  • Tax and super professionals will contain super information for professionals, including SMSF auditors and APRA-regulated funds.

Environmental scan

The Law Council of Australia highlighted tax issues relating to successor fund transfers (SFTs) and requested the ATO consider updating guidance for funds. Implications for members’ transfer balance cap (TBC) were raised.

The ATO confirmed it understands the implications for members’ TBC following an SFT and have been meeting with affected funds to discuss these implications. However, the ATO must administer the tax system in accordance with the law.

The Financial Services Council shared its 3 areas of focus:

  • guidance on fund labelling for investment options
  • the development of industry code for responding to scams
  • customer service standards, with an upcoming focus on death benefits and how these should be treated.

Quality of member services

Member service quality is an area of concern and a source of complaints. In the 2022–23 financial year, AFCA received 6,957 superannuation complaints. Of these, 2,210 complaints related directly to an aspect of service quality including account administration errors, incorrect fees and costs, and the failure to follow member instructions. Complaints about delays in the payment of death benefits tripled in the last year. AFCA noted that a very small proportion of superannuation transactions each year result in a complaint. ACFA also noted that the figures do not include issues resolved by funds internally.

AFCA outlined some common issues that arise in complaints. Trustees should consider how these can be addressed to reduce the number of avoidable complaints:

  • poor communications with members
  • failure to raise eligibility issues in a timely manner
  • poor processes for the collection of medical information
  • unreasonable or onerous requests for information
  • unreasonable expectations of members
  • failure to have a dedicated claims consultant as a member's point of contact
  • failure by the trustee to regularly engage with the insurer during the claims process.

Trustees noted the following challenges in handling complaints:

  • resourcing pressures and a lack of skilled case officers to handle complex claims
  • increased number of complaints and members proactively lodging complaints as they are more engaged with their superannuation
  • SFT or fund mergers – systems integration issues.

Members discussed:

  • concerns over vulnerable members receiving onerous requests for medical records, or other demands that can exacerbate medical conditions
  • requests for excessive identification documents and how to balance this issue against the risk of fraud
  • accessibility issues for rural/regional customers, or those without appropriate technology to upload documents (digital exclusion)
  • the move from contact centres towards digital self-service platforms by some funds is proving to have higher success rates for being able to resolve issues internally and avoid escalation to AFCA
  • issues around reportable deaths and pre-existing conditions affecting eligibility for benefit payment.

Members were encouraged to work on improving processes and optimising communication to improve the member experience. Members were also encouraged to proactively identify issues around fund mergers/SFTs that can impact the quality of member services.

Payday Super

Treasury provided an update on the progress of Payday Super. Consultation is expected to run for 4 weeks commencing in September 2023, with further consultation on exposure draft legislation planned for 2024.

Key issues include:

  • the definition of ‘Payday’ – is payday when payment is made by an employer, or when the funds are received by the fund and attributed to a member account?
  • the compliance system – can the current SG charge be redesigned to ensure intentional non-compliance is treated more seriously than inadvertent errors?
  • data flow – what role can data validation play in preventing poor outcomes?

Most industry representatives supported considering the equity of the SG charge and the potential application of firmer penalties to employers, particularly when there has been deliberate non or underpayment of SG.

In preparing the key messages for the meeting, several members clarified that their support of the Payday Super measure does not indicate support for any weakening of the compliance regime.

Members asked if technological infrastructure will be considered in the consultation.

Improving data quality

The ATO provided an update on the importance of data quality and accuracy.

Timely, accurate and complete reporting by employers and super funds is critical to the tax, super and social security systems. Under-reporting, and the underpayment of PAYG withholding and SG, results in an uneven playing field. It threatens the integrity of the tax and super system, government revenue, and peoples’ retirement savings.

The ATO is working to promote good governance for employers and improve the processes employers have in place for managing data. This will reduce costs for employers in correcting errors and avoid unnecessary contact and reviews.

Engagement and education

The ATO will consult with various stakeholders to determine underlying causes of poor data quality and will develop strategies to improve reporting.

Nudge and remind

The ATO will nudge and prompt employers where information appears to be incorrect or overdue.

Firmer action

The ATO will undertake range of tailored activities designed to improve future compliance and correct poor habits or lack of diligence. This will include reviews and audits, payroll governance reviews, increased application of penalties, and prosecution.

Members noted that there may be opportunities to learn from the experiences of other countries in improving data quality.

Data quality for superannuation funds will be discussed at a future meeting.

Supporting retirement income

The government supports superannuation through concessions, but also provides the pension. As superannuation balances grow, the proportion of public expenditure on pensions decreases, highlighting the benefits of superannuation.

Members discussed the implications of default minimum drawdown rates.

  • Members noted the need to look at the issue longitudinally rather than in the short term.
  • Members questioned whether minimum drawdown rates could be considered in age ranges.
  • Members commented people will tend to draw down on their balance more in times of financial distress, that is, the global financial crisis or COVID-19.
  • Treasury confirmed that just over 50% of people will follow the minimum drawdown rates.
  • Members noted a study into how rules around drawdowns are perceived and understood will help change behaviour.

Treasury confirmed consultation on tax concessions is planned which will include reviewing minimum drawdown rates. Treasury noted that as superannuation balances increase, people are looking for a longevity solution.


Attendees list




Usha Narain (Co-chair), Superannuation and Employer Obligations


Larissa Evans, Superannuation and Employer Obligations


Peta Lonergan, Superannuation and Employer Obligations

Association of Super Funds Australia

Glen McCrea

Australian Financial Complaints Authority

Heather Gray

Australian Prudential Regulation Authority

Carolyn Morris

Australian Prudential Regulation Authority

Katrina Ellis

Australian Securities and Investments Commission

Jane Eccleston

Australian Securities and Investments Commission

Jessica Spence

Business Council of Australia

Stephen Kirchner

Chartered Accountants Australia and New Zealand

Tony Negline

Council on the Ageing Australia

Patricia Sparrow

Financial Services Council

Spiro Premetis

Industry Super Australia

Ella Cebon

Law Council of Australia

Michael Mathieson

Link Group

Deborah Schembri


David Knox (Co-chair)

Super Consumers Australia

Xavier O’Halloran

The Tax Institute

Phil Broderick


Lynn Kelly

Guest Attendees

Guest attendees




Kylie White, Superannuation and Employer Obligations


Naomi Westwood, Superannuation and Employer Obligations

Australian Prudential Regulatory Authority

Emily Langford

Australian Institute of Superannuation Trustees

David Haynes

SMSF Association

Mary Simmons


Adam Hawkins


Anthony Hynes


James Thomson


Matthew Laing


Sam Pelly


Wendy Hau


Apologies list




Emma Rosenzweig (Co-chair), Superannuation and Employer Obligations

Australian Institute of Superannuation Trustees

Melissa Birks

Law Council of Australia

Maged Girgis

SMSF Association

Peter Burgess