- AIST Policy News - 9 June 2017
AIST Policy News
Australians want default funds that serve members not shareholders
An Essential Media Poll conducted for AIST has found that the vast majority (91%) believe default superannuation funds should return all profits to members.
The poll – based on 1,014 respondents – also found that 71 per cent of those surveyed believe an employer should not be able to select a default fund that is associated with their bank as this may not necessarily be in the workers’ best interests.
AIST CEO Eva Scheerlinck said the results showed that the public want a default superannuation system that values members, not shareholders.
“First and foremost, our default super fund system must ensure that members’ interests are protected,” said Ms Scheerlinck. “This includes ensuring that members’ interests come ahead of any employer incentives offered by banks and other companies such as access to overdrafts or loans at cheaper rates.”
The polling also showed that while more than half of respondents understand the idea of a default fund, the majority were unaware that the default fund is agreed by employers and workers when setting wage and conditions under an enterprise/certified agreement.
“When it comes to trust and reputation, profit-to-member funds are miles ahead, but issues such as poor financial literacy and lack of confidence remain a challenge,” said Ms Scheerlinck. “One in four people surveyed don’t know if they are in a default fund or not.”
On choosing a superannuation fund, research showed that women are less likely (56%) to choose their own fund than men (67%). However, women were more likely to take their old fund across to a new employer when changing jobs. When asked why they selected their current super fund, a slight majority answered “no particular reason”. This was followed by “it was the only one offered” (17%), “reputation” (14%), and “it’s for people in my industry” (14%).
The survey was conducted online from the 2nd to 5th February 2017 and is based on 1,014 respondents.
Increasing pension age to 70 will hurt many older workers
AIST has urged the Government to consider the high levels of involuntary retirement before raising the Age Pension eligibility age to 70 years old.
In a media release issued this week AIST CEO Eva Scheerlinck said that it isn’t just people with health issues who are struggling to work until age 70.
“Many older Australians do not get to choose when they retire,” said Ms Scheerlinck. “We know that while health plays a role, other factors such as age discrimination, job type and caring demands all have a significant impact on when a person retires from paid work.”
Research conducted by the Australian Centre for Financial Studies and AIST found that up to 40 per cent of older Australians do not get to choose when they retire due to a range of factors.
Those working in community and personal services, in clerical and administrative roles, sales workers and labourers are between 35 and 50 per cent more likely to retire before the age of 60 than professional workers.
ATO seeks input on new superannuation guarantee compliance tool
The Australian Tax Office (ATO) is seeking input on a new tool that can help assess if a business is meeting their super obligations.
TheSuper guarantee - client health checkwas developed in consultation with tax professionals and it highlights the essential questions employers need to answer when paying super for employees.
Designed as an easy way to see if an employer is meeting all their super requirements, the tool also links to helpful web content and calculator tools to help employers.
The client health check is located in the Let's Talk super community page. Members wanting to share their feedback can do so on the provided feedback form.
Start date of new financial reporting requirements for super funds looms
The Australian Accounting Standards Board is running a free webinar to help super funds gain further understanding of new financial reporting requirements that apply to super fund this financial year.
The requirements – known as AASB 1056 Superannuation Entities - replace the Standard AAS 25 Financial Reporting by Superannuation Plans.
The new standard has been developed to:
- recognise significant changes in the superannuation industry since AAS 25 was issued in 1993
- reflect the substance of the relationship between superannuation entities and members by recognising members’ entitlements as liabilities
- more closely align financial reporting with similar entities, such as Pooled Superannuation Trusts and Managed Investment Schemes.
Hosted by AASB CEO Kris Peach and Acting Assistant Technical Director Clark Anstis, the webinar will provide an opportunity to discuss implementation issues that have been raised with the AASB.
The webinar will be held on Friday the 16th of June. Full details and details on how to register are here. Guidance and more information on the changes is available here.
Volunteers wanted for the Big Super Day Out in QLD
AIST and First Nations Foundation are seeking people to volunteer their time and expertise to help members of the Indigenous community sort out their super at the Big Super Day Out in Brisbane.
The Big Super Day Out – organised by AIST’s charity partner First Nations Foundation – will be a fun day including entertainment, giveaways, prizes and is your opportunity to help the Indigenous community better engage with the super system.
We are seeking a range of volunteers including:
- RG146 compliant advisers comfortable with navigating the myGov website and providing general advice if necessary;
- Passionate volunteers from the super industry happy to assist with ad-hoc duties including collecting data, directing foot traffic, and more.
Volunteers must be available for a three hour shift between 9AM to 3PM on Friday 7 July 2017.
Interested parties can contact First Nations Foundation with their expression of interest on (03) 9670 5904 or email firstname.lastname@example.org