The Federal Government is undertaking to release within two weeks the draft regulations and operating standards which will apply to the licensing of superannuation trustees as a result of the Superannuation Safety Amendment Bill.
The legislation was introduced to the Parliament on Thursday, with the Assistant Treasurer, Senator Helen Coonan saying it will provide Australian workers with a safer superannuation system.
“Protecting the retirement savings of all Australians is a key priority of the Government and these reforms will help make super safer than ever,” she says.
The central element of the new legislation area provisions requiring trustees of superannuation funds regulated by theAustralian Prudential Regulation Authorityto be licensed, while the funds themselves will need to have risk management plans in place as well as meeting enhanced reporting requirements.
The legislation provides for the new provisions to take effect from 1 July, next year, with a two-year transition period being applied to allow the industry sufficient time to get its house in order.
However the Opposition spokesman on Retirement Incomes, Senator Nick Sherry says the legislation is “weak and wimpy”.
“It is fine as far as it goes but it doesn’t go very far in terms of ensuring full compensation in the event of fraud and bankruptcy,” he says.
Sherry says the ALP will be looking at amending the legislation in the context of the relevant Senate Committee but that this is something that will be addressed in the New Year.
The legislation has been welcomed as “sensible and workable” by theAssociation of Superannuation Funds of Australia.
ASFA chief executive Philippa Smith says the legislation represents a definite improvement on the original draft provided by the Government and suggest the Government listened to the industry and made practical amendments.
The Bill was also welcomed by theInvestment and Financial Services Association, with chief executive Richard Gilbert saying the legislation represents a balanced approach.
Coonan says that while the Government has already consulted extensively on the new legislation, a further period of consultation will take place when the new regulations and operating standards are released by the Department of Treasury within the next fortnight.
“The importance of increasing public confidence in the super system is paramount and these reforms to improve the safety of super are an important plank in building the confidence of Australian workers in the super system,” she says.
