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Recommendations
Recommendation 1
2.15 The
committee recommends that APRA expand the information provided in its quarterly
superannuation statistics to include a regular representative survey of the
level of additional contributions above the 9 per cent superannuation guarantee
from both employer and employee (salary sacrifice) and other forms of
contribution. This should include analysis by income level and gender.
Recommendation 2
2.34 The
committee recommends that Treasury conduct a review of the laws and regulations
governing superannuation to identify how they may be rationalised and
simplified.
Recommendation 3
2.66 The
committee recommends that APRA, in consultation with peak superannuation bodies
and academics in particular, undertake empirical research on the strengths and
weaknesses of superannuation systems operating in other OECD countries, and
that the findings be made publicly available. The aim is to develop a framework
for benchmarking Australia's superannuation system against international best
practice.
Recommendation 4
3.35 The
committee recommends that peak superannuation bodies and APRA continue to work
with the Australian Accounting Standards Board with a view to forming appropriate
compulsory accounting and disclosure by all funds for promotional advertising,
sponsorship expenses and executive remuneration.
Recommendation 5
3.64 The
committee recommends that the government formulate and implement an effective
disclosure policy for both product disclosure statements and annual reports to
address any deficiencies in reporting related party transactions.
Recommendation 6
3.65 The
committee recommends that trustees of superannuation funds publicly tender key
service provision agreements.
Recommendation 7
3.95 The
committee recommends that the government's proposed measures to simplify breach
reporting be implemented through legislation.
Recommendation 8
3.97 The
committee recommends that Treasury examine and report to government on the
issue of overlapping, inconsistent and conflicting requirements of
superannuation funds from a number of regulators.
Recommendation 9
4.58 The
committee recommends that APRA make available for public scrutiny any legal
advice it has received on the role of the trustee in a member investment choice
situation, as a starting point for further industry consultation to clarify the
duties of trustees of funds that offer member investment choice.
Recommendation 10
4.59 The
committee recommends that APRA, in consultation with the superannuation
industry, review Superannuation Circular II.D.1 to clarify its interpretation
of the role of the trustee in a member investment choice situation. The
committee further recommends that APRA ensure that its written guidance better
integrate the reality of investment choice and the obligations of trustees
under the SIS Act.
Recommendation 11
4.60 The
committee recommends that superannuation funds be permitted as part of reform
to the disclosure regime to provide simple, standard advice to members at their
request about the appropriateness or otherwise of non-standard default
investment options within the fund.
Recommendation 12
5.26 The
committee recommends that superannuation funds improve the disclosure of their
capital backing and/or the risk protection of capital and that APRA assist the
industry with the development of disclosure of risk management systems to
protect superannuation investors' funds.
Recommendation 13
5.33 The
committee recommends that the government mandate a uniform unit pricing
methodology for all public offer superannuation funds, including any
transitional arrangements. The committee also recommends that where unit
pricing is utilised improved operational risk parameters are identified and
implemented by APRA.
Recommendation 14
5.70 The committee recommends that
the government examine whether employee salary sacrifice should be paid by the
employer at a minimum at the same time as the compulsory SG, and whether
employer SG contributions should be paid on the pre-salary sacrifice income.
Recommendation 15
5.84 The
committee recommends that exit fees that exceed the administrative cost of
transfer should be prohibited prospectively.
Recommendation 16
5.105 The
committee recommends that where a tax file number is attached to a lost account
it should be automatically consolidated or rolled together into a member's last
active account using the tax file number system. The member should have the
right to opt out of the system if they wish. This automatic system should not
apply to a defined benefit account or an account with a significant exit fee.
Recommendation 17
6.110 The
committee recommends that ASIC provides guidance to superannuation funds on the
provision of targeted communication to separate categories of fund members, so
called limited advice, without triggering the need for a statement of advice.
Recommendation 18
6.114 The
committee recommends that ASIC consult further with superannuation funds on the
provision of online calculators. Following this process ASIC should provide
additional regulatory relief that will better enable funds, without undermining
consumer protection imperatives, to use the generic calculator exemption to
provide benefit projections for their members.
Recommendation 19
6.118 The
committee recommends that ASIC should provide accountants with relief from
holding an AFS licence in circumstances where they advise clients to alter
their superannuation contribution levels or consolidate their superannuation
investments into an existing fund.
Recommendation 20
6.146 The
committee recommends that the government conduct market research on the
readability of superannuation product disclosure statements with the goal to
introduce simple, standard, readable documentation.
Recommendation 21
7.96 The
Committee recommends that ASIC work with the industry to provide to investors
more effective and detailed disclosure of shelf fees.
Recommendation 22
7.142 The
committee recommends that the government consult with the superannuation
industry with a view to reducing, with appropriate limitations, the constraints
imposed by the sole purpose test on the payment of up front fees for financial
advice from superannuation accounts.
Recommendation 23
7.146 The committee recommends that the
government investigate the most effective way to develop with the industry
appropriate nomenclature where the product recommendation advice available to
consumers is limited by sales imperatives.
Recommendation 24
7.148 The
committee recommends that ASIC should release a policy statement mandating that
financial advisers disclose the ownership structure of their licensee when
making a superannuation product recommendation.
Recommendation 25
7.170 The
committee recommends that the government conduct a review of its Financial
Literacy Foundation initiatives when their effectiveness is able to be measured
against clear performance benchmarks.
Recommendation 26
8.21 The committee recommends that the active member test be
removed from the definition of an Australian Superannuation Fund.
Recommendation 27
8.23 The committee recommends that fund members be able to draw
superannuation pensions 'in specie', in line with existing provisions for lump
sum payments.
Recommendation 28
8.36 The
committee recommends that the ATO consider raising the maximum number of
trustees for any one SMSF from four to ten, in line with current and future
demand.
Recommendation 29
8.37 The
committee recommends that a simple and clear alert warning should be provided
to all trustees of an SMSF on their duties and responsibilities, the
recommended ASIC minimum maturity figure and the absence of part 23
compensation in the event of theft and fraud.
Recommendation 30
8.45 The
committee recommends that SMSFs run by qualified accountants be audited
annually for three years from their commencement and, subject to no
irregularities, thereafter every five years. SMSFs found to be non-compliant
are to be audited annually for three further years.
Recommendation 31
8.61 The
committee recommends that the accountants' exemption be broadened in keeping
with its previous recommendation 1 to amend subregulation 7.1.29A. This would
enable accountants to advise clients on the structure of any superannuation
fund, rather than being limited to advising on the structure of self-managed
funds only.
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