Superannuation Alert 11.05.16
Financial Services eBulletin - 11 May 2016
The Lander & Rogers Superannuation Alert is a brief overview of new developments in the superannuation industry.
- On 28 April 2016, (before the Government went into Caretaker Mode) Assistant Treasurer Kelly O'Dwyer announced that the Exposure Draft - Corporations Amendment (Professional Standards of Financial Advisers) Bill 2015 will be amended 'to ensure existing financial advisers are provided with a smooth transition as part of reforms to raise the education, training and ethical standards of the financial advice industry'. Assistant Treasurer O'Dwyer announced the following amendments:
- the establishment of a standard setting body 'to administer the professional standards regime';
- the education and exam requirements will be deferred until 1 January 2019 (previously, 1 July 2017); and
- existing advisers will not need to reach degree-equivalent status until 1 January 2024 and have until 1 January 2021 to pass the exam.
- On 3 May 2016, Treasury released the Retirement Income Streams Review report in relation to the review of the minimum withdrawal amounts for account-based pensions and the regulatory barriers restricting the availability of retirement income stream products in Australia. The review concluded that 'the minimum drawdown rules work well for account-based pensions and the current minimum drawdown rates are about right'. On the other hand, the review found that '[t]he existing regulatory framework for retirement income stream products is… a barrier to the development of other annuity-style products that could help individuals better manage the risk of outliving their retirement savings'.
- On 5 May 2016, Assistant Treasurer Kelly O'Dwyer announced that the Government has accepted all seven recommendations of the review and that from 1 July 2017 tax barriers to the development of new retirement income products will be removed 'by extending the tax exemption on earnings in the retirement phase to products such as deferred life annuities and group self-annuitisation products which do not currently qualify for this exemption.'
- On 6 May 2016, Treasury released the discussion paper titled Proposed Financial Institutions Supervisory Levies for 2016-17. The paper was prepared in conjunction with APRA and seeks submissions in relation to the proposed financial institutions supervisory levies for the 2016-17 financial year. Submissions can be made until 3 June 2016.
- On 9 May 2016, both Houses of Federal Parliament were dissolved to enable an election of both Houses on 2 July 2016. The Government is now in Caretaker Mode and all Bills that have not been passed by both Houses have lapsed. Relevantly, the following are lapsed Bills:
- Superannuation Legislation Amendment (Choice of Fund) Bill 2016 (Cth);
- Superannuation Legislation Amendment (Transparency Measures) Bill 2016 (Cth);
- Superannuation Legislation Amendment (Trustee Governance) Bill 2015 (Cth);
- Treasury Legislation Amendment (Repeal Day 2015) Bill 2016 (Cth); and
- Corporations Amendment (Life Insurance Remuneration Arrangements) Bill 2016 (Cth).
- On 9 May 2016, the Financial System Legislation Amendment (Resilience and Collateral Protection) Regulation 2016 (Cth) was registered. The Regulation and the Financial System Legislation Amendment (Resilience and Collateral Protection) Bill 2016 (Cth) (which received Royal Assent on 5 May 2016) allows trustees of superannuation funds and life companies to provide margin by way of security in relation to derivatives in the manner required to access international capital markets and liquidity. The Regulation also updates the list of "approved bodies" (which are markets and clearing houses) to whom trustees of superannuation funds and life companies may grant security.
All information on this site is of a general nature only and is not intended to be relied upon as, nor to be a substitute for, specific legal professional advice. No responsibility for the loss occasioned to any person acting on or refraining from action as a result of any material published can be accepted.