SuperStream Advisory Council meeting
5 April 2013
The SSAC recognises the importance of developing an appropriate interoperability agreement to enable the implementation of the SuperStream initiatives. Equally, having the appropriate governance framework in place that is owned and controlled by stakeholders in the superannuation industry is also critical.
At its meeting on 7 March 2013, the SSAC agreed to invite the relevant industry associations (in conjunction with the Affiliation of Superannuation Practitioners (ASP)) to jointly present to the SSAC on progress and plans to meet the requirements of the industry.
ASP is an organisation which on 28 February 2013 was incorporated and limited by guarantee. It includes representatives from the following organisations which handle a significant proportion of the transactions throughout the industry (AAS, AMP, BT, Colonial First State, MLC, onepath, Pillar, Superpartners). The ASP has been sending and receiving Rollover files electronically between all participants using an agreed data standard & protocols since September 2011. There are potentially significant lessons learned from this initiative that can benefit the entire industry. The SSAC was informed that membership of ASP is open to other stakeholders.
AIST, ASFA, FSC, ISN and ASP presented to the SSAC on 5 April 2013. Key points out of the presentation included:
- Significant evidence of collaboration between the industry associations on these matters. This includes legal support for this ongoing collaboration via a draft Memorandum of Understanding (MOU) between the industry associations. This MOU has the endorsement of the respective boards and is expected to be executed within the next two weeks. (This draft MOU has subsequently been provided to the SSAC.)
- Acknowledgement of the need for expertise to assist in ensuring interoperability operates properly. This is evidenced by a second MOU between the industry associations and ASP (which has also been provided to the SSAC)
- Contrary to some industry talk, it has NOT been agreed that ASP will ultimately become the governance body.
- The need to break the objectives into two parts.
- Finalisation of the interoperability agreement and associated standards; and
- Finalisation of the ongoing governance arrangements.
Priority is to be given to the former. In this regard, substantial work is being done on the relevant agreement based on two key exhibits. These are the draft interoperability agreement developed by the previous SuperStream Working Group and also the interoperability agreement for the APCA COIN. A draft agreement is intended to be in place towards the end of this month. It was noted that the industry associations and ASP have consulted with APCA and SSAC encourages APCA's continued involvement in this process.
In regard to the governance arrangements, a framework has been put in place to:
- Define the needs of an ongoing governance body
- Develop an expression of interest in respect to these needs
- Test for prospective providers of governance services
- The industry associations acknowledged that stakeholder representation on ASP at this stage is too narrow relative to the representation required for the Superstream initiative and ultimately needs to be expanded for the ongoing governance arrangements. Broader consultation is also needed in respect to the interoperability standards.
The SSAC acknowledges the extent of hard work put in by all participants and is encouraged by the extent of collaboration that is occurring. It views these as very positive for the industry. SSAC notes the approaching implementation deadlines and encourages continued aggressive progress.
The SSAC endorses the framework developed by the industry associations for the development of the interoperability agreement (and associated standards) and ongoing governance arrangements with the following qualifications:
- The industry associations and ASP should seek to formalise an arrangement with APCA to provide further technical and other support during the development phases of both the interoperability agreement (and standards) and ongoing governance arrangements.
The SSAC is of the view that a number of the issues to be addressed for an interoperability network are not superannuation specific. It would give both employers and superannuation providers a greater degree of confidence in the outcome if the superannuation industry initially partnered with an organisation experienced with interoperability standards and self-regulatory frameworks. Further, APCA has previously assisted in the establishment of new entities, such as eftpos, Payments Australia Limited (ePAL), and such a role may also be of assistance within the current context.
The Expression of Interest to be developed by the industry associations for ongoing governance arrangements must have a broad representation from the regulated stakeholders throughout the industry and key service providers (and particularly between the employers and superannuation funds).
With the involvement of employers in the SuperStream initiatives, it is important that representation cover not only superannuation funds (whether outsourced or self-administered) and administrators, but employers, accountants, software providers and SMSFs.
- There should be complete transparency and regular reporting back to the SSAC on progress against timetable, risks and issues.
- A plan for communicating with the entire industry is developed as a matter of priority.
The SSAC encourages the ATO and APRA to review the interoperability agreement and standards as they are developed and include appropriate updates in communications and guidance notes to encourage maximum take-up by trustees.