Superannuation Alert - 02.09.15
Financial Services eBulletin - 2 September 2015
The Lander & Rogers Superannuation Alert is a brief overview of new developments in the superannuation industry.
- On 20 August 2015, the Tax and Superannuation Laws Amendment (2015 Measures No. 4) Bill 2015 was introduced into the House of Representatives. According to the Explanatory Memorandum, the Bill proposes to amend, among other things, the Superannuation (Unclaimed Money and Lost Members) Act 1999 to "increase the account balance threshold below which small lost member accounts must be transferred to the Commissioner of Taxation from $2,000 to $4,000 from 31 December 2015, and from $4,000 to $6,000 from 31 December 2016".
- On 21 August 2015, the Treasury released an Exposure Draft for the Superannuation Guarantee Legislation Amendment (Simplification) Bill 2015. According to the Explanatory Materials, the superannuation guarantee (SG) charge will be simplified by aligning the earnings base for calculating the SG charge (currently total salary and wages) with the earnings base for calculating SG contributions (ordinary time earnings). The changes will also align the interest component on any SG shortfall with the period contributions are outstanding. The proposed changes will also remove the additional penalties under the Superannuation Guarantee (Administration) Act 1992 and align them with the administrative penalties under the Tax Administration Act 1953. The changes are proposed to apply from 1 July 2016. Submissions are due by 18 September 2015.
- On 21 August 2015, the Queensland Supreme Court delivered its judgment in Edington v Board of Trustees of the State Public Sector Superannuation Scheme  QSC 245. The applicant in this case was a member of State Public Sector Superannuation Scheme and made an application for TPD insurance benefits which was declined by the Board on the basis that his disability was due to an undisclosed pre-existing condition, schizophrenia, rather than a work-related injury. Having exhausted all his rights to challenge the Board's decision under the Superannuation (Resolution of Complaints) Act 1993, the applicant sought to set aside the Board's decision either under section 8 of the Trusts Act 1973 (Qld) (Trusts Act), or alternately on the basis that the Board had breached an insurance contract between the Board and the applicant. Relying on the principles expounded in Karger v Paul  VR 161, the Court dismissed the application. The Court found that, on the facts, there was nothing to support the setting aside of the Board's decision under section 8 of the Trusts Act and no contract of insurance existed between the applicant and the Board.
- On 28 August 2015, the Treasury released an Exposure Draft for the Treasury Amendment (Spring Repeal Day) Bill 2015. According to the Explanatory Material, in relation to superannuation, the Bill amends the Superannuation (Unclaimed Money and Lost Members) Act 1999 (Cth) and other superannuation laws to "enable the Commissioner of Taxation to pay certain superannuation amounts directly to individuals with a terminal medical condition and to remove the requirement for superannuation funds to lodge a separate biannual lost members statement with the Commissioner". Submissions are due by 9 October 2015.
- On 28 August 2015, the Treasury released a consultation paper titled "Proposed industry funding model for the Australian Securities and Investments Commission". The consultation paper sets out measures to address the Financial System Inquiry recommendation that the Government should move to adopt an industry funding model. Submissions are due by 9 October 2015.
- On 31 August 2015, APRA released a consultation package on governance arrangements for superannuation trustees. Accordingly to APRA's media release, the package "proposes amendments to APRA's governance prudential framework in light of the Government's proposed legislative amendments to require boards of RSE licensees to have at least one third independent directors, including an independent chair". The package contains:
- a discussion paper titled "Governance arrangement for RSE licensees";
- Draft Prudential Standard SPS 510 Governance;
- Draft Prudential Standard SPS 512 Governance Transition;
- Draft Prudential Practice Guide SPG 510 Governance; and
- Draft Prudential Practice Guide SPG 512 Governance Transition.
Submissions are due by 23 October 2015.
- The Senate Economics References Committee has made available the terms of reference (undated) for its inquiry into economic security for women in retirement. In particular, the Senate Economics Committee will have regard to the impact inadequate superannuation savings has on the retirement outcomes for women; the extent of gender retirement income gap and the causes of this gap, and its potential drivers; any structural impediments in the superannuation system; the adequacy of the main sources of retirement income for women; and measures that would provide women with access to adequate and secure retirement incomes. The Economics References Committee will have its first sitting day in March 2016.
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.