The Government’s Your Future, Your Super package – announced in the 2020-21 Budget – is a comprehensive package of reforms designed to make sure the superannuation system delivers better outcomes for members.
The Government has released exposure draft legislation and explanatory material for public consultation. These contain the following elements:
- Requiring employers to make contributions into an employee’s existing fund, if new employees have one and do choose a fund to receive contributions. This reform will help ensure unnecessary fees and insurance premiums are not paid on unintended multiple superannuation accounts.
- Requiring APRA to conduct an annual performance test for MySuper products, and other products specified in regulations. Trustees will be required to give notice to members when a product fails the test. Where a product has failed the performance test in two consecutive years, the trustee is prohibited from accepting new beneficiaries into that product. APRA may lift the prohibition if circumstances specified in the regulations are satisfied. This reform will ensure underperforming superannuation products are held to account.
- Providing certainty and transparency about the basis by which superannuation products will be ranked and published on a website maintained by the ATO.
- Requiring superannuation trustees to act in the best financial interests of their members. This reform ensures trustees are focused on members’ financial interests when they undertake the many actions in operating a superannuation entity. These actions include incurring day-to-day essential operational expenditure and investing members’ money, to less frequent strategic decisions and discretionary expenditures.
Submissions for this consultation are welcome at firstname.lastname@example.org.