Superannuation alert - 3.9.14
Financial Services eBulletin - 3 September 2014
The Lander & Rogers Superannuation Alert is a brief overview of new developments in the superannuation industry.
- On 26 August 2014, APRA released its response to the FSI Interim Report. APRA commented that it agreed with the findings of the FSI Interim Report that fees in the superannuation sector should not be considered in isolation and must be considered in light of the outcomes for members. APRA also commented that:
- the introduction of MySuper has resulted in trustees increasing their focus on the features of the superannuation products that they are offering, the related operating costs and level of fees charged;
- it is too early to conclude whether the objectives of the MySuper reforms will be achieved, particularly in relation to reduced fees;
- slightly longer period of five to seven days for processing rollovers is supported; and
- APRA feels that risks associated with direct leverage cannot be managed within the superannuation prudential framework and they are incompatible with the aims of superannuation.
- On 27 August 2014, Treasury released the Exposure Draft for Treasury Legislation Amendment (Repeal Day) Bill 2014 which amends, amongst other things, the Superannuation Industry (Supervision) Act 1993 (SIS Act). The Explanatory Material states that the Exposure Draft repeals the payslip reporting provisions in the SIS Act. Treasury is seeking comments on the Exposure Draft by 17 September 2014.
- On 28 August 2014, the House of Representatives passed the Corporations Amendment (Streamlining of Future of Financial Advice) Bill 2014 (Cth) with seven amendments which include a power for the regulations to prescribe when benefits are conflicted remuneration. The bill was introduced in the Senate on 1 September 2014.
- On 28 August 2014, the NSW Court of Appeal decided in SAS Trustee Corporation v Green  NSWCA 289 that a disabled member of the police force was entitled to an additional amount of annual superannuation allowance because she was 'exposed to risks which members of the general workforce would normally not be required to be exposed in the course of their employment' under the Police Regulation (Superannuation) Act 1906 (NSW).
- On 1 September 2014, the Minerals Resource Rent Tax Repeal and Other Measures Bill 2013 [No 2] was laid aside in the House of Representatives. Instead, the Government introduced the Minerals Resource Rent Tax Repeal and Other Measures Bill 2014 which was passed by the Senate with 13 Government amendments yesterday. The amendments:
- confirm the Income Support Bonus will continue until 31 December 2016;
- introduce a means test for the Schoolkids Bonus so that only families on incomes of up to $100,000 per annum will qualify until it is discontinued on 31 December 2016;
- confirm the Low Income Super Contribution will apply until 30 June 2017; and
- prescribe that the compulsory superannuation rate will be frozen at 9.5% for the 7 years from 1 July 2014 to 30 June 2021, and then will increase by 0.5% per year from 1 July 2022 until it reaches 12% on or after 1 July 2025.
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