Super Alert – 26 September 2019

26 September 2019

This week’s Super Alert looks at the registration of new ASIC Instruments, guidance from the ATO about inactive accounts and a Federal Court TPD case.

ASIC disclosure instruments registered

On 18 September 2019, the following instruments were registered on the Federal Register of Legislation:

  • ASIC Corporations (Unclaimed Superannuation—Former Temporary Residents) Instrument 2019/873 (First Instrument); and
  • ASIC Corporations (Repeal) Instrument 2019/874 (Second Instrument).

The First Instrument remakes existing Class Order CO 09/437 (in relation to departed former temporary residents) with one minor amendment to replace “website for the trustee” with “website for the fund”. The Second Instrument repeals existing Class Orders CO 09/437 (in relation to departed former temporary residents) and CO 09/210 (in relation to intra-fund superannuation advice) as they are no longer necessary.

Please click here and here to read more.

APRA releases Member Outcomes speech

On 19 September 2019, APRA released a speech given by Chair Wayne Byres in relation to “Driving better member outcomes”.

Mr Byres’ comments included:

  • “…the [new] legislation and standards provide a strong platform for APRA to drive a much more intense focus on member outcomes. It will inevitably produce some difficult discussions with trustees who are not delivering for their members”;
  • APRA “will be … shortly kicking off consultation on a major overhaul of the superannuation data reporting regime. This overhaul aims to provide greater coverage, more granularity, enhanced consistency and better quality data”; and
  • Beginning with MySuper products, APRA plans “to publish a selected set of performance-related measures and benchmarks….[APRA’s] view is: let’s have the debate.”

Please click here to read more.

Federal Court decision on TPD benefit

On 20 September 2019, the Federal Court of Australia handed down its decision in Aslami v Board of Trustees of the State Public Sector Superannuation Scheme as Trustee for the QSuper Fund [2019] FCA 1560. The case considered an appeal from a judgment of the SCT to affirm a trustee’s decision to decline a member’s claim for a TPD benefit.

The Court held that the SCT had properly conducted its review function and upheld the original decision. The Court held that the SCT made no error in taking into account the member’s own business when assessing his existing education, training or experience for the purposes of the TPD definition.

Please click here to read more.

Council of Financial Regulators’ consideration of superannuation liquidity risks

On 23 September 2019, the Council of Financial Regulators (Council) released its quarterly statement following a meeting on 18 September 2019 where the Council “discussed risks facing the Australian financial system, regulatory issues and developments relevant to its members”.

In relation to the superannuation industry specifically, the Council noted that “arrangements for managing liquidity at superannuation funds during periods of market stress…had operated as intended during the financial crisis and had since been strengthened”. In addition, it was agreed that “circumstances where a systemic liquidity problem could arise for the superannuation system were highly unlikely”.

The Council is comprised of representatives from the Reserve Bank of Australia, ASIC, APRA and the Treasury.

Please click here to read more.

ATO guidance in relation to inactive low-balance account reporting

On 23 September 2019, the ATO released guidance that provides its response to “common questions which were asked during the August 2019 Unclaimed money, lost member and inactive low-balance account reporting obligations webinar”.

The questions covered include:

  • “How to report a member who meets the definition of more than one type of USM?”
  • “When will the new reporting code for inactive low balance accounts be available?”; and
  • “When will ATO be sending USM out message and payment to Funds?”.

Please click here to read more.

This alert was written by Natalie Cambrell, Partner and Sanela Osmanovic, Associate.


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