House of Representatives

Superannuation (Unclaimed Money and Lost Members) Bill 1999

Superannuation (Unclaimed Money and Lost Members) Act 1999

Explanatory Memorandum

(Circulated by authority of the Treasurer, the Hon Peter Costello, MP)

General outline and financial impact

This Bill improves and consolidates provisions relating to unclaimed money and lost members in the Superannuation Industry (Supervision) Act 1993 and the Retirement Savings Accounts Act 1997. The aim of this Bill is to reunite people with their superannuation, particularly casual and itinerant workers and those with broken employment patterns (eg. fruit-pickers and other itinerant labourers) who have superannuation savings but who have lost the paperwork associated with their account, were never given the paperwork because they terminated employment before the contribution was made or lost contact with their fund in other circumstances.

Date of effect: Subject to transitional arrangements, this Bill will apply from Royal Assent.

Proposal announced: Not previously announced.

Financial impact: A small unquantifiable increase in revenue is expected to result from superannuation money paid from State and Territory unclaimed money registers being taxed in the same manner as superannuation money paid from complying superannuation funds, retirement savings accounts and the Commonwealth unclaimed money register. Administration costs for Commonwealth, State and Territory unclaimed money registers will be substantially reduced through provisions facilitating greater co-operation between the registers and extending the use of tax file numbers to the Commonwealth lost members register and the State and Territory unclaimed money registers.

Compliance cost impact: Minimal.

Chapter 1 - Overview and Preliminary

Overview

1.1 This Bill provides for a scheme relating to unclaimed superannuation money (unclaimed money) and lost superannuation members (lost members).

1.2 This Bill consists of 8 Parts. The main provisions are contained in Parts 3, 4 and 5 of this Bill and govern the reporting and payment of unclaimed money and the reporting of lost members. The ancillary provisions of this Bill (ie. preliminary, interpretative and administrative provisions etc.) are contained in Parts 1, 2, 6, 7 and 8 of this Bill.

Summary

Purpose

1.3 This Bill improves the efficiency of existing arrangements for reuniting people with their superannuation by:

extending the use of tax file numbers (TFNs) for superannuation purposes to the Commonwealth lost members register and the State and Territory unclaimed money registers (currently, the use of TFNs for superannuation purposes is limited to the Commonwealth unclaimed money register);
improving the definition of unclaimed money to better target cases of unclaimed money (eg. unpresented cheques);
allowing the Commissioner of Taxation (the Commissioner) to publish details relating to unclaimed money (eg. publish the names of people with unclaimed money as currently permitted for unclaimed bank money subject to safeguards such as subclause 44(2) of this Bill which expressly prohibits the Commissioner from publishing TFNs);
facilitating greater co-operation between Commonwealth, State and Territory unclaimed money registers; and
including regulated exempt public sector superannuation schemes within the unclaimed money and lost members scheme.

1.4 This Bill also consolidates existing provisions relating to unclaimed money and lost members which are currently spread over 4 items of legislation. The existing provisions are set out in Part 22 of the Superannuation Industry (Supervision) Act 1993 (the SIS Act), regulation 11.08 of the Superannuation Industry (Supervision) Regulations (the SIS Regulations), Part 8 of the Retirement Savings Accounts Act 1997 (the RSA Act) and regulation 6.09 of the Retirement Savings AccountsRegulations (the RSA Regulations).

1.5 This Bill also ensures that consistent taxation arrangements (eg. the eligible termination payment and reasonable benefit limits provisions) apply to unclaimed money paid from State and Territory unclaimed money registers as currently apply to superannuation payments from complying superannuation funds, retirement savings accounts (RSAs) and the Commonwealth unclaimed money register.

Date of effect

1.6 Subject to transitional arrangements, this Bill will apply from Royal Assent. [Clause 2]

Transitional arrangements

1.7 The reporting and payment of unclaimed money to Commonwealth, State and Territory unclaimed money registers is currently linked to half-calendar years (ie. 1January to 30June and 1July to 31December). Superannuation providers must determine the unclaimed money they have at the end of each half-year and pay those monies and report information in respect of those monies within 4 months from the end of the half-year.

1.8 This Bill continues this half-calendar year cycle of reporting and payment, however to ensure that the effect of this Bill is prospective, this Bill will apply in respect of the next half-year after Royal Assent. [Clause 3]

1.9 The Superannuation (Unclaimed Money and Lost Members)Consequential and TransitionalBill1999 (the Consequential Amendments Bill) contains a transitional provision for State and Territory unclaimed money registers. Currently, a precondition for State and Territory unclaimed money registers receiving unclaimed money is that the relevant State or Territory legislation must satisfy the requirements of subsections 225(9), (9A) and (9B) of the SISAct and subsections 84(1), (2) and (3) of the RSA Act. Similar requirements are contained in clause18 of this Bill.

1.10 Clause5 of the Consequential Amendments Bill provides that if State or Territory unclaimed money legislation does not satisfy the requirements of clause18 of this Bill on commencement of this Bill, the legislation will despite that non-satisfaction, continue to apply to unclaimed money until the end of a transitional period of 2 years, or the State or Territory unclaimed money legislation satisfies the requirements, whichever is the earlier.

1.11 As clause18 of this Bill is in similar terms to existing subsections 225(9), (9A) and (9B) of the SISAct and subsections 84(1), (2) and (3) of the RSAAct, existing State and Territory unclaimed money legislation may satisfy the requirements.

1.12 If the unclaimed money legislation of a State or Territory does not satisfy the requirements of clause18 of this Bill, the 2 year transitional period will provide the State or Territory with an opportunity to amend the legislation to make it satisfy the requirements.

Background to the legislation

1.13 The Superannuation Guarantee (Administration) Act 1992 and the Superannuation Guarantee Charge Act 1992 provided a major extension of superannuation to the workforce. With the increased coverage, many casual and itinerant workers and those with broken employment patterns became lost members in the sense that they lost the paperwork associated with their account, were never given the paperwork because they terminated employment before their superannuation guarantee contributions were made or lost contact with their fund in other circumstances .

1.14 The Commonwealth Government policy document Strengthening Superannuation Security (21October1992) announced the establishment of the Commonwealth unclaimed money register and the Commonwealth lost members register to maximise the prospect of superannuation members receiving contributions made on their behalf. Along with State and Territory unclaimed money registers, the Commonwealth registers are currently operating under the SISAct and the RSAAct.

1.15 This Bill will strengthen arrangements for reuniting people with their superannuation (particularly casual and itinerant workers and workers with broken employment patterns). The existing structure of the registers (which is outlined in the following paragraphs) will remain unchanged.

Commonwealth, State and Territory unclaimed money registers

1.16 Unclaimed money is governed by Commonwealth legislation (Part 22 of the SISAct and Part 8 of the RSAAct). However, if a State or Territory has consistent legislation, superannuation providers are required to pay and report information in respect of unclaimed money to State and Territory unclaimed money registers (rather than the Commonwealth unclaimed money register).

1.17 Due to the preservation rules governing superannuation, superannuation money is only considered to be unclaimed if the member has reached eligibility age (60 years for women and 65 years for men) or has died. In contrast, the Commonwealth lost members register only requires superannuation providers to report information (rather than pay money) and aims to reunite members with their money before their money is deemed to be unclaimed and has to be paid to an unclaimed money register.

1.18 The Commonwealth unclaimed money register applies where no State or Territory unclaimed money scheme applies to the particular unclaimed money of a superannuation provider. This may involve:

cases where the State or Territory has no unclaimed money legislation (eg. Western Australia);
cases where the State or Territory has inconsistent unclaimed money legislation; or
cases where the State or Territory has consistent unclaimed money legislation but the legislation does not extend to the particular case of unclaimed money (eg. certainCommonwealth superannuation schemes).

1.19 The Commonwealth unclaimed money register has been operational since 1July1997 and except for Western Australia, State and Territory unclaimed money registers became operational at or shortly after this time. Western Australia has not enacted unclaimed money legislation and therefore unclaimed money in Western Australia is paid to the Commonwealth unclaimed money register.

1.20 The Commonwealth unclaimed money register is administered by the Commissioner under:

a SISAct Modification for regulated superannuation funds and approved deposit funds (Australian Securities and Investments Commission Digest Class Order 99/1); and
Part 8 of the RSAAct for RSAs.

1.21 When the SIS Act commenced on 1December1993, provision was made for the Insurance and Superannuation Commissioner (ISC) to administer the register but before the register became operational it was decided to pass responsibility for the register to the Commissioner on the basis of the greater experience and efficiencies that the Australian Taxation Office has in system administration. This decision was announced on 4April1996 in ISC Modification Declaration No.13.

Commonwealth lost members register

1.22 The reporting of information in respect of lost members is governed by Commonwealth legislation (regulation 11.08 of the SISRegulations and regulation 6.09 of the RSARegulations). The information is required to be reported to the Commonwealth lost members register.

1.23 As with the Commonwealth unclaimed money register, the Commonwealth lost members register is administered by the Commissioner. The register has been operational since 1July1996.

1.24 In addition to reuniting people with their superannuation, the register is a preventative measure aimed at minimising the number of cases which become unclaimed money.

Preliminary

Overview

1.25 Part1 of this Bill sets out the preliminary provisions of the Superannuation (Unclaimed Money and Lost Members) Act 1999 (the Act). [Clauses 1to7]

Purpose of the provisions

1.26 The purpose of the provisions is to determine the ambit of the Act and provide an overview of the Act.

Explanation of the provisions

Title and Commencement of the Act

1.27 When this Bill is enacted it will be called the Superannuation (Unclaimed Money and Lost Members) Act 1999. [Clause 1]

1.28 The Act will commence on the day it receives the Royal Assent, and will apply from the next half-year after that date. [Clauses 2and3]

Scope of the Act

1.29 The Act binds the Crown in right of the Commonwealth, the States, the Australian Capital Territory, the Northern Territory and Norfolk Island and applies to external Territories. The Crown cannot be prosecuted for any offences under the Act. [Clauses 4and5]

Objects of the Act

1.30 The general object of the Act is to reunite people with their superannuation and improve and consolidate existing arrangements relating to unclaimed money and lost members (eg. provide for greater co-operation and co-ordination between the Commonwealth, States and Territories).

1.31 The specific objects of the Act are set out in clause6 of this Bill and are to provide for:

the keeping of registers of details relating to unclaimed money, so that the money can be claimed by persons entitled to it;
the keeping of a register of details relating to lost members, so that the benefits of lost members can be claimed by persons entitled to them;
the matching of unclaimed money and persons entitled to it;
the matching of benefits of lost members and persons entitled to them;
the safe-keeping of unclaimed money until the money is claimed by a person entitled to it;
the co-ordination of the collection of unclaimed money between the Commonwealth, States and Territories; and
the co-ordination of the matching of unclaimed money and persons entitled to it between the Commonwealth, States and Territories.

Outline of the Act

1.32 Clause7 highlights the significant features of the operation of the Act.

Chapter 2 - Interpretation

Overview

2.1 Part 2 of this Bill sets out the interpretation provisions of the Superannuation (Unclaimed Money and Lost Members) Act 1999 (the Act). [Clauses 8 to 10]

Purpose of the provisions

2.2. The purpose of the provisions is to provide definitions of expressions and terms used in the Act.

Explanation of the provisions

Definitions

2.3 Definitions of expressions and terms used in this Bill have been drawn from existing superannuation legislation and are self-explanatory. [Clause 8]

Meaning of accrual of benefits

2.4 A reference in this Bill to an accrual of benefits for a member of a defined benefits superannuation scheme does not include allocations of investment earnings or the charging of costs [Clause 9] . This meaning is consistent with the meaning attributed to an accrual of benefits for the purposes of sub-regulation 7.01(1) of the Superannuation Industry (Supervision) Regulations. The question of whether there has been an accrual of benefits is relevant for determining whether a person has unclaimed money in accordance with clauses 12 and14 of this Bill. A pre-condition for unclaimed money in respect of a member of a defined benefits superannuation scheme is that there has been no accrual of benefits in the last 2 years.

Meaning of eligibility age

2.5 The effect of clause 12 of this Bill is that a member must have reached the eligibility age before they are considered to have unclaimed money. A reference to eligibility age is a reference to 60 years for a woman and 65 years for a man unless a different age is prescribed in the regulations. This meaning of eligibility age under this Bill is the same as its meaning in section 10 of the Superannuation Industry (Supervision) Act 1993 (the SISAct) and section16 of the Retirement Savings Accounts Act 1997 (the RSAAct) [subclause 10(1)] .

2.6 If a superannuation provider does not know whether a member is a man or a woman or the age of a member, this Bill provides guidance for the superannuation provider [subclause 10(2)] . The term superannuation provider means a trustee of a regulated superannuation fund or approved deposit fund or a retirement savings account provider [Clause 8] .

2.7 If a superannuation provider does not know whether a member is a man or a woman (eg. does not have any record indicating the sex of the member), the member is taken to be a man. [Paragraph 10(2)(a)]

2.8 If a superannuation provider does not know the members age (eg. does not have any record indicating the age of the member), the superannuation provider may determine that the member is the following age:

the age the superannuation provider reasonably believes to be the members age (this method would allow the superannuation provider to use a method that they considered was a reasonable approximation of the members age); or
the age based on the member turning 18 on any of the following dates: the date the member joined the fund, the date an amount was first received by the fund in respect of the member or the date the members eligible service period commenced [Paragraph 10(2)(b)] . The term fund means a regulated superannuation fund, approved deposit fund or retirement savings account [Clause 8] .

Statutory duty to obtain date of birth and sex of member of fund and keep records

2.9 A superannuation provider should make reasonable attempts to obtain the date of birth or the sex of a fund member if the provider does not have that information. This duty is a statutory duty and failure to fulfil the duty is a breach of statutory duty. [subclause 10(3)]

2.10 A superannuation provider should keep records of the date of birth or sex of a fund member if it knows that information. This duty is a statutory duty and failure to fulfil the duty is a breach of statutory duty. [subclause 10(4)]

Chapter 3 - Payment of unclaimed money to the Commissioner

Overview

3.1 Part3 of this Bill contains provisions which set out a procedure for dealing with unclaimed money in funds. [Clauses 11to20]

Purpose of the provisions

3.2 The purpose of the provisions is to provide:

the meaning of unclaimed money;
obligations on superannuation providers to make reasonable efforts to ensure that members who have immediately payable benefits in an inactive account (or in cases of death, beneficiaries), receive their benefits;
requirements relating to the payment and provision of statements in respect of unclaimed money;
greater co-operation between Commonwealth, State and Territory unclaimed money registers; and
a legislative framework for the operation of the Commonwealth unclaimed money register.

Explanation of the provisions

Object of Part

3.3 The object of Part3 of this Bill is to set out a procedure for dealing with unclaimed money in funds. [Clause 11]

General meaning of unclaimed money

3.4 An amount payable is treated as unclaimed money if:

the member has reached eligibility age;
the superannuation provider determines that under the governing rules of the fund or by operation of law, a benefit (other than a pension or annuity) is immediately payable in respect of the member;
the superannuation provider has not received an amount in respect of the member (and, in the case of a defined benefits superannuation scheme, no benefit has accrued in respect of the member) for at least 2 years (eg. the account has been inactive for the last 2 years); and
after making reasonable efforts and after a reasonable period has elapsed (eg. a reasonable period may be necessary to resolve legal issues), the superannuation provider is unable to ensure that the member receives the benefit.

[Clause 12]

Superannuation provider to make reasonable efforts to ensure the member receives the benefit

3.5 If the member has reached eligibility age and has immediately payable benefits in an inactive account, the superannuation provider must make reasonable efforts to ensure that the member receives the benefits [subclause 13(1)]. The maximum penalty on conviction for failure to comply with this obligation is a fine of 100 penalty units [subclause 13(2)].

Meaning of unclaimed money deceased member

3.6 An amount payable is treated as unclaimed money if:

the member has died;
the superannuation provider determines that under the governing rules of the fund or by operation of law, a benefit (other than a pension or annuity) is immediately payable in respect of the member;
the superannuation provider has not received an amount in respect of the member (and, in the case of a defined benefits superannuation scheme, no benefit has accrued in respect of the member) for at least 2 years; and
after making reasonable efforts and after a reasonable period has elapsed, the superannuation provider is unable to ensure that the benefit is received by the person who is entitled to receive the benefit.

[Clause 14]

Superannuation provider to make reasonable efforts to ensure the person receives the benefit

3.7 If the member has died, the account of the deceased has been inactive (ie. for a 2 year period before, after or spanning the death) and a person is entitled to a part or whole of the members account, the superannuation provider must make reasonable efforts to ensure that the person receives their entitlement [subclause 15(1)] . The maximum penalty on conviction for failure to comply with this obligation is a fine of 100 penalty units [subclause 15(2)] .

Payments and reporting of unclaimed money

Statement of unclaimed money

3.8 A superannuation provider must give to the Commissioner of Taxation (the Commissioner), an approved form of statement of all unclaimed money at the end of each half-year unless State or Territory unclaimed money legislation is applicable in which case the statement must be given instead to the State or Territory unclaimed money register. [subclauses 16(1) and 18(2)]

3.9 If between the end of the half-year and the day the statement is given to the Commissioner, the superannuation provider pays any unclaimed money to a person entitled to it, the statement must contain such particulars relating to the amounts paid as are required by the approved form. [subclause 16(2)]

3.10 An unclaimed money statement must be given to the Commissioner within 4 months of the end of each half-year:

1November for the half-year ending 30June; and
1May for the half-year ending 31December.

[subclause 16(3)]

3.11 The Commissioner may, in writing, extend the time to lodge the unclaimed money statement before, on or after the due date (ie.1Mayand 1November each year). [subclause 16(4)]

3.12 If the requirements in respect of unclaimed money statements to be given to the Commissioner apply to a superannuation provider and the provider has not complied with the requirements, the provider is liable to a fine of up to 100 penalty units. [subclause 16(5)]

3.13 A superannuation provider does not fail to comply with the requirement to report unclaimed money within the 4 month period if the Commissioner has extended the time to lodge the unclaimed money statement and the superannuation provider lodged the statement within the extended period. [subclause 16(6)]

Payment of unclaimed money to Commissioner

3.14 The superannuation provider must pay with the statement to the Commissioner, the outstanding amount of unclaimed money for the half-year. [subclause 17(1)]

3.15 The Commissioner must pay unclaimed money to a person if:

unclaimed money has been paid to the Commissioner by a superannuation provider; and
the Commissioner is satisfied that the superannuation provider who paid the unclaimed money to the Commissioner, would have paid the unclaimed money to the person.

[subclause 17(2)]

3.16 If a superannuation provider satisfies the Commissioner that an amount of unclaimed money paid by the superannuation provider to the Commissioner exceeds the correct amount due to the person concerned, the Commissioner must refund the excess amount collected, to the provider. [subclause 17(3)]

3.17 The superannuation provider is discharged from further liability in respect of the unclaimed money upon payment of the money to the Commissioner. [subclause 17(4)]

3.18 The Consolidated Revenue Fund is appropriated for the purposes of receipt and payment of unclaimed money. [subclause 17(5)]

3.19 A superannuation provider that does not comply with the requirements relating to the payment of unclaimed money to the Commissioner is liable to a fine of up to 100 penalty units. [subclause 17(6)]

Payment of unclaimed money to a State or Territory authority

3.20 If the unclaimed money legislation of a State or Territory satisfies the 2 requirements set out in subclauses18(4) and (5) of this Bill, the superannuation provider must report and pay the unclaimed money to the State or Territory unclaimed money register in accordance with that law (instead of the Commissioner). [subclauses 18(1),(2) and(3)]

3.21 The first requirement is that the unclaimed money legislation of the State or Territory has provisions with the following effects:

a superannuation provider must prepare, at the end of each half-year, a statement, in an approved form by a State or Territory authority, of all unclaimed money that is held in the fund;
the statement must be given to a State or Territory authority before:

-
1November for the half-year ending 30June; and
-
1May for the half-year ending 31December;

when the unclaimed money statement is provided, the superannuation provider must pay to the State or Territory authority, the outstanding amount of unclaimed money for the half-year; and
the State or Territory authority must keep a register with the particulars of:

-
the unclaimed money as paid by superannuation providers; and
-
each member in respect of whom there is unclaimed money.

[subclause 18(4)]

3.22 The second requirement is that the unclaimed money legislation of the State or Territory has provisions which correspond to the following provisions of the Superannuation (Unclaimed Money and Lost Members) Act 1999 (the Act) and have the following effects:

Subsection 16(2): This provision requires the unclaimed money statement to have particulars relating to payments made after the end of each half-year as required by the approved form of the State or Territory authority.
Subsection 16(4): This provision empowers the State or Territory authority to extend the time period for lodging the unclaimed money statement.
Subsection 17(2): This provision requires the State or Territory authority to pay unclaimed money to a person in circumstances where the State or Territory authority is satisfied that the person would have been paid that money by the superannuation provider by whom it was paid to the State or Territory authority.
Subsection 17(3): This provision requires the State or Territory authority to refund excess payments to superannuation providers.

[subclause 18(5)]

3.23 The superannuation provider is discharged from further liability in respect of the unclaimed money upon payment of the money to the State or Territory unclaimed money register. [subclause 18(6)]

Commonwealth unclaimed money register

Register of unclaimed money

3.24 The Commissioner must keep a register that has particulars of:

unclaimed money paid by a superannuation provider to the Commissioner; and
each member entitled to the unclaimed money.

[subclause 19(1)]

3.25 The register may also contain:

other information given to the Commissioner that is of the type contained in the register (this will allow the register to be updated with other relevant information given to the Commissioner, for example, from members of the public);
information originally contained in State and Territory unclaimed money registers and provided to the Commissioner by those registers; and
information relating to unclaimed money of members of regulated exempt public sector superannuation schemes.

[subclauses 19(2), (3), (4) and(5)]

Commissioner may provide information to State and Territory authorities

3.26 The Commissioner may give unclaimed money information to State or Territory unclaimed money registers for the purposes of the Act (eg. for the purpose of identifying multiple entries for a person on Commonwealth, State and Territory unclaimed money registers). [Clause 20]

Chapter 4 - Lost Members

Overview

4.1 Part4 of this Bill contains provisions which set out the basic framework of how a scheme, to be established by regulations, may deal with lost members of funds for the purpose of reuniting members with their superannuation benefits. [Clauses 21to24]

Purpose of the provisions

4.2 The purpose of the provisions is to provide:

for regulations to establish a scheme for information regarding lost members to be provided to the Commissioner of Taxation (the Commissioner) (the required information may be set out by the Commissioner in an approved form); and
greater co-operation between the Commonwealth lost members register and State and Territory unclaimed money registers.

Explanation of the provisions

Object of Part

4.3 The object of Part 4 of this Bill is to set up a scheme, to be established under the regulations, for dealing with lost members of funds. [Clause 21]

Meaning of lost member

4.4 A member is treated as a lost member if he or she is a lost retirement savings account holder within the meaning of the Retirement Savings AccountsRegulations or a lost member within the meaning of the Superannuation Industry (Supervision)Regulations. [Clause 22]

Regulations may establish a scheme

4.5 The regulations may set up a scheme in which superannuation providers are to give statements, in the approved form, to the Commissioner containing information relating to:

each lost member of the superannuation provider;
each lost members benefits in the funds managed or provided by the superannuation provider;
each member of the superannuation provider who is no longer a lost member of the provider and their benefits;
matters that the Commissioner reasonably believes may assist the lost members register.

[subclause 23(1)]

4.6 The scheme must provide for the Commissioner to keep a register that contains the information given by the superannuation providers under the scheme. [Paragraph 23(2)(a)]

4.7 The scheme may provide for the Commissioner to keep a register that contains:

other information given to the Commissioner that is of the type contained in the register (this will allow the register to be updated with other relevant information given to the Commissioner, for example, from members of the public); and
information relating to lost members of regulated exempt public sector superannuation schemes.

[Paragraph 23(2)(b) and subclauses23(3) and(4)]

4.8 A superannuation provider that does not comply with a requirement of the scheme is liable to a fine of up to 100 penalty units. [subclause 23(5)]

Commissioner may provide information to State and Territory authorities

4.9 The Commissioner may give lost member information to State or Territory unclaimed money registers for the purposes of the Superannuation (Unclaimed Money and Lost Members) Act 1999 (eg. for the purpose of identifying multiple entries for a person on Commonwealth lost members register and State and Territory unclaimed money registers). [Clause 24]

Chapter 5 - Tax File Numbers

Overview

5.1 Part5 of this Bill contains provisions dealing with tax file numbers (TFNs). [Clauses 25to30]

Purpose of the provisions

5.2 The purpose of the provisions is to provide for:

the use of TFNs for superannuation purposes (eg. reuniting people with their superannuation) in connection with unclaimed money and lost members (TFNs are currently authorised for superannuation purposes in relation to regulated superannuation funds, approved deposit funds retirement savings accounts and the Commonwealth unclaimed money register); and
additional safeguards on the proper quotation of TFNs (safeguards are currently set out in Part 25A of the Superannuation Industry (Supervision) Act 1993 and Part 11 of the Retirement Savings Accounts Act 1997).

Explanation of the provisions

Forms etc. may require TFN

5.3 The approved form of unclaimed money statement or lost member statement may require the statement to contain the TFN of:

the fund; and
the member where:

-
the statement relates to the member; and
-
the member has quoted their TFN to the superannuation provider.

[Clause 25]

Regulated exempt public sector superannuation schemes

5.4 The approved form of unclaimed money statement or lost member statement may permit the statement to contain the TFN of:

the regulated exempt public sector scheme; and
the member where:

-
the statement relates to the member; and
-
the member has quoted their TFN to the trustee of the scheme.

[Clause 26]

Registers may contain TFNs

5.5 The particulars of persons that may be included in the unclaimed money and lost members registers may include their TFN. [Clause 27]

Use of TFNs

5.6 Clause 28 of this Bill allows the Commissioner of Taxation (the Commissioner) to use for the purposes of the Superannuation (Unclaimed Money and Lost Members) Act 1999 a persons TFN that has been quoted to the Commissioner for any other purpose and is expressed in similar terms to section140RA of the Income Tax Assessment Act 1936.

Requesting TFNs

5.7 The unclaimed money and lost members registers may request that a claimant of the registers quote their TFN for the purposes of dealing with their claim. A person is not obliged to quote their TFN and non-quotation does not preclude the person from being paid unclaimed money. [Clause 29]

Quoting of TFNs

5.8 TFN quotation (including requests for TFN quotation) must be in accordance with the manner approved in writing by the Commissioner. [Clause 30]

Chapter 6 - Secrecy

Overview

6.1 Part6 of this Bill contains secrecy provisions.

Purpose of the provisions

6.2 The purpose of the provisions is to provide for:

secrecy provisions consistent with secrecy provisions applying to other Commonwealth authorities; and
recognised exceptions to those provisions.

[Clauses 31to39]

Persons to whom Part applies

6.3 Part6 applies to a person who is or has been:

the Commissioner of Taxation (the Commissioner), a Second Commissioner of Taxation or a Deputy Commissioner of Taxation;
an officer or employee of a branch of the Australian Public Service under the direct control of the Commissioner; or
in other cases, appointed or employed by, or a provider of services for the Commonwealth.

[subclause 31(1)]

6.4 A person to whom Part 6 applies must, if and when required by the Commissioner to do so, make an oath or declaration, in a manner and form set out in writing by the Commissioner to maintain secrecy in accordance with Part6. [subclauses 31(2) and(3)]

Information may be recorded or disclosed only for purposes of the Act

6.5 A person to whom Part6 applies must not:

make a record of any protected information; or
disclose directly or indirectly to a person any protected information about a third party,

unless the record is made, or the information is disclosed:

under or for the purposes of Superannuation (Unclaimed Money and Lost Members) Act 1999 (the Act); or
in performing a persons duties under or in relation to the Act. [Clause 32]

6.6 A person who commits a breach of secrecy is liable to a term of imprisonment of up to 2 years. [Clause 32]

Court may not require information or documents

6.7 A person to whom Part6 applies is not required:

to disclose protected information to a court; or
to produce a protected document in court,

except if it is necessary for the purposes of implementing the Act. [Clause 33]

Information may be disclosed to persons performing duties under Acts administered by the Commissioner

6.8 Part6 does not prohibit the Commissioner or an authorised person from disclosing any protected information to a person performing duties under legislation administered by the Commissioner for the purpose of enabling that person to perform the duties. [Clause 34]

Information may be disclosed to persons performing duties under the Act

6.9 Nothing in the Act or other legislation of which the Commissioner has general administration prohibits the Commissioner or an authorised person from disclosing any information to a person performing duties under the Act for the purpose of enabling that person to perform the duties [Clause 35] . The Commissioner may authorise a person who is an officer or employee under the Public Service Act 1922 to be an authorised officer for the purposes of the Act [Clause 45] .

Information may be disclosed to a court for the purposes of the Act

6.10 Nothing in the Act or other legislation of which the Commissioner has general administration, prohibits the Commissioner or an authorised person from:

disclosing to a court any information obtained under or for the purposes of the Act or other legislation of which the Commissioner has general administration; or
producing in court a document:

-
obtained; or
-
made under or for the purpose of the Act or the other legislation;

where it is necessary for the purposes of implementing the Act. [Clause 36]

Information may be disclosed with consent of the superannuation provider or individual

6.11 Part 6 does not prohibit the Commissioner or an authorised person from disclosing any protected information relating to:

the affairs of a superannuation provider or a trustee of a regulated exempt public sector superannuation scheme if the provider or trustee agrees in writing to disclose the information; or
an individual if the individual agrees in writing to the disclosure of the information.

[Clause 37]

Information may be disclosed to specified persons or bodies

6.12 The Commissioner or an authorised person is authorised to disclose information to:

the Australian Prudential Regulation Authority, for the purposes of the performance of any of its functions or the exercise of any of its powers;
the Minister, the Secretary to the Department, or an officer of the Department authorised by the Secretary to the Department for the purposes of Part6;
the Superannuation Complaints Tribunal for the purposes of the performance of any of its functions or the exercise of any of its powers;
the Australian Securities and Investments Commission for the purposes of the performance of any of its functions or the exercise of any of its powers;
a financial sector supervisory agency for the purposes of the performance of any of its functions or the exercise of any of its powers; or
the Australian Statistician or an officer of the Australian Bureau of Statistics, for purposes, limited to statistics, under the Census and Statistics Act 1905.

[Clause 38]

Australian Bureau of Statistics to observe secrecy requirements

6.13 If information is disclosed to the Australian Statistician or an officer of the Australian Bureau of Statistics, that information or the information contained in the document, is treated as information given under the Census and Statistics Act 1905. [Clause 39]

Chapter 7 - Administration

Overview

7.1 Part7 of this Bill contains administration provisions. [Clauses 40to41]

Purpose of the provisions

7.2 The purpose of the provisions is to provide for:

the Commissioner of Taxation (the Commissioner) to have general administration of Superannuation (Unclaimed Money and Lost Members) Act 1999 (the Act); and
an annual report to be prepared by the Commissioner on the working of the Act and for it to be presented to the Parliament.

Explanation of the provisions

7.3 The Commissioner is to have general administration of the Act. [Clause 40]

7.4 After each financial year, the Commissioner must give the Treasurer an annual report on the working of the Act for presentation to the Parliament. [Clause 41]

Chapter 8 - Miscellaneous

Overview

8.1 Part8 of this Bill contains miscellaneous provisions. [Clauses 42to50]

Purpose of the provisions

8.2 The purpose of the provisions is to provide for:

publication of information in the Commonwealth unclaimed money register and the Commonwealth lost members register for the purpose of alerting people to their superannuation benefits;
access and information provisions consistent with access and information provisions in other Acts administered by the Commissioner of Taxation (the Commissioner);
the keeping of records by superannuation providers;
approved forms to specify the information required for the unclaimed money and lost members registers;
regulations; and
other miscellaneous provisions.

Explanation of the provisions

Act not to operate so as to contravene Constitution

8.3 The Superannuation (Unclaimed Money and Lost Members) Act 1999 (the Act) does not apply in any circumstances where it would have the consequence of contravening the Constitution. [Clause 42]

Application of the Criminal Code

8.4 Chapter2 of the Criminal Code which deals with the general principles of criminal responsibility, applies to all offences against the Act. [Clause 43]

Publication of information in registers

8.5 The Commissioner may authorise information in the Commonwealth unclaimed money register and the Commonwealth lost members register to be:

published in the Gazette;
made available to the public (whether or not on the payment of a fee) in such other manner as the Commissioner determines; or
made available to a particular person (whether or not on the payment of a fee) in such manner as the Commissioner determines.

[Clause 44]

8.6. The authorisation may extend to so much of the information in the registers as the Commissioner considers appropriate. The Commissioner is explicitly prohibited from including tax file numbers in the publication. [Clause 44]

Authorised officers

8.7 The Commissioner may, by writing authorise a person who is an officer or employee under the Public Service Act 1922 to be an authorised officer for the purposes of a provision or provisions of the Act. [Clause 45]

Access to premises and obtaining information and documents

8.8 This Bill contains provisions dealing with access to premises and information gathering powers. Similar provisions are found in other Acts administered by the Commissioner for example, sections263 and 264 of the Income Tax Assessment Act 1936 (ITAA1936). The provisions are necessary for the Commissioner to ensure compliance with the Act. [Clauses 46and47]

8.9 The access and information gathering powers may be used, for example, to ensure that a superannuation provider has reported the information it has in respect of a lost member or a member with unclaimed money. This information is critical to the function of the registers and in such a case, it may be necessary for the Commissioner to inspect documents which may not otherwise be available for inspection if access and information gathering powers were not included in the Act.

8.10 Under these powers, an authorised officer must be given entry at any reasonable time, to land or premises. The officer must also be given full and free access to all books, records and other documents held by any person, and right to inspect, examine or make copies there from [subclause 46(1)] . An authorised officer is an officer or employee within the meaning of the Public Service Act 1922 who has been authorised in writing by the Commissioner to carry out certain duties [Clause 45] .

8.11 The officer is not entitled to remain on the land or premises unless written authority signed by the Commissioner is produced at the request of the occupier. [subclause 46(2)]

8.12 The occupier of land or premises entered or proposed to be entered by an authorised officer is required to provide the officer with all reasonable facilities and assistance to carry out official duties. [subclause 46(3)] For example, an authorised officer will be entitled to reasonable use of photocopying, telephone, facsimile and light and power facilities and of work space and facilities to extract relevant information stored on computer. In addition, the officer will be entitled to reasonable assistance in the form of, for example, advice as to where relevant documents are located and access to areas where such documents are located.

8.13 The maximum penalty on conviction for failure to comply with the access to premises provisions is a fine of 10 penalty units. [subclause 46(4)]

8.14 The Commissioner will also be able to require, by notice in writing, any person to:

give information on oath or otherwise;
attend before the Commissioner and answer questions on oath or otherwise; or
produce any documents in the custody or under the control of that person.

[subclauses 47(1),(2) and(3)]

8.15 The regulations must prescribe scales of expenses to be allowed to persons required to attend before the Commissioner. [subclause 47(4)]

Record keeping requirements

8.16 This Bill imposes certain record keeping requirements on superannuation providers [Clause 48] . Superannuation providers must keep records of all transactions and acts engaged in under the Act [subclause 48(1)] .

8.17 The records must be kept in writing in the English language or, if not in writing (eg. in an electronic medium such as magnetic tape or computer disc), in a form which is readily accessible and convertible into writing in English. [subclause 48(2)]

8.18 The records must be retained until the end of 5 years or the completion of the transactions or acts to which those records relate (eg. this may involve the cessation of the member being a lost member of the provider), whichever is the later. [subclause 48(3)]

8.19 A superannuation provider does not have to keep records if the Commissioner notifies the provider that it is not required to do so. [subclause 48(4)]

8.20 The maximum penalty on conviction for failure to comply with the record keeping requirements is a fine of not more than 60 penalty units. [subclause 48(5)]

Approved forms

8.21 A notice, application, statement, or other document is in an approved form if it:

is in a form approved in writing by the Commissioner;
contains all the required information; and
is lodged at the place and in the manner that the Commissioner requires.

[subclause 49(1)]

8.22 An approved form may extend to electronic transmissions, mediums and forms and may apply to more than one notice, application, statement or other document. [subclauses 49(2) and(3)]

Regulations

8.23 This Bill provides that the Governor-General may make regulations for the purposes of the Act. [subclause 50(1)]

8.24 The regulations may also make provision for the Commissioner to keep one or more registers that relate to matters arising under the Act or regulations. This will provide flexibility for sub-registers or additional registers (if necessary) to be established by regulations. [subclause 50(2)]


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