- AIST Policy News - 9 November 2017
AIST Policy News
First Home Super Saver Scheme on shaky ground
The Government’s proposed First Home Super Saver Scheme (FHSSS) looks to be in trouble with reports in today’s Fairfax media pointing to a lack of crossbench support for the bill in the Senate.
The scheme – announced at this year’s May Federal Budget as a measure to tackle housing affordability – would allow people to save up to $30,000 through voluntary tax-exempt super contributions that could then be withdrawn at a later date when buying their first home.
AIST had significant reservations about the scheme, noting in our submission to Treasury in August that the measure was neither consistent with the sole purpose test nor the Government’s proposed objective of superannuation. We also had concerns about how the scheme would be implemented and would work in practice.
Legislation for the super home buyer scheme was set to be debated in the Senate on Monday.
Meanwhile, the bill to enshrine the objective of superannuation is, itself, stalled in the Senate, with expectations that the debate on this bill will not resume until the New Year.
Also before the Senate are the three bills that were introduced to Parliament in September. This includes the bill requiring trustees to have a minimum of one-third independent directors and an independent chair; the bill containing a new outcomes assessment and director penalties measures; and the bill to create the new Australian Financial Complaints Authority. Given the backlog of legislation before the Senate, AIST expects debate on these bills to be delayed until the New Year. If passed by the Senate, the bills must then be passed in the House of Representatives – and this may be more difficult, given the citizenship circumstances of several MPs.
The bill which was introduced to the House of Representatives to remove the salary sacrifice loopholes as well as the ability of enterprise agreements to prescribe single funds in workplaces has already passed the House, and is currently in front of the Senate.
Industry feedback sought on transition/funding of new complaints body
The transition body for the Australian Financial Complaints Authority (AFCA) – which is set to absorb the Superannuation Complaints Tribunal - has released a consultation paper setting out the key transition issues.
The AFCA transition body, chaired by Dr Malcom Eedy, is responsible for ensuring a smooth transition from the existing external dispute resolution schemes to AFCA. The paper invites comment on issues such as transition arrangements, the proposed Terms of Reference and AFCA’s funding model. This consultation provides an excellent opportunity for interested parties to provide their views on key issues such as the scheme’s Terms of Reference and potential funding models.
AIST will be preparing a submission and invites member feedback, to AIST research officer Jake Sims at email@example.com or on (03) 8677 3855. Submissions close 20 November 2017.
Legislation for the establishment of AFCA as a one-stop complaints service to absorb the SCT, the Financial Ombudsman Service and the Credit and Investment Ombudsman is currently before Parliament. AIST remains concerned about the potential for super fund members to lose some protection under the new arrangement and continues to consult with stakeholders on this and other issues.
AIST backs centralised whistleblowing framework
AIST has strongly endorsed proposals for a new centralised whistleblower protection framework for Australia, whilst noting this should be accompanied by a wider examination of corporate misconduct in the banking sector.
AIST’s submission to Treasury, says the examination of misconduct in the banking sector is necessary because a strong whistleblower framework on its own cannot prevent misconduct and other factors such as poor workplace culture.
AIST’s submission also notes that while we support an enhancement to current whistleblower protection regime we note that any new requirements for large companies to have a whistleblower policy in place should be consistent with existing legal requirements and avoid unnecessary duplication of the law.
AIST gender diversity report
The AIST Gender Diversity Report is now available. The report provides a snapshot of what profit-to-member superannuation funds are doing to promote gender diversity and inclusion within their organisations.
AIST is a strong advocate for gender diversity and inclusion and acknowledges that diversity can have a positive impact in a number of areas within an organisation such as improved decision making.
The AIST Gender Diversity report reveals that many superannuation funds are taking positive steps towards achieving gender diversity and implementing changes to ensure each gender is equally supported, and able to thrive within the organisation. Participating funds generally had better processes, policies, strategies and procedures in place to support gender diversity in the workplace when compared to organisations in the finance sector.
To download a copy of the report please click here.
If you would like to discuss the report or have any further questions please contact AIST research officer Jake Sims on (03) 8677 3855 or at firstname.lastname@example.org
As previously advised, the Australian Securities and Investments Committee (ASIC) announced on 1 November that it has extended its facilitative compliance approach and will work with an external expert to conduct a review of RG97.
AIST will be making a submission regarding the review’s Terms of Reference. AIST is strongly advocating:
- An outcomes-based focus is essential.
- Key policy issues which result in a lack of a level playing field must be addressed.
- Consultation processes must be improved.
In other news concerning the regulator, APRA has commenced discussions regarding the development of a new data portal. At the same time, ASIC has commenced discussions to establish pilot programs seeking to capture recurrent data.
For both initiatives, AIST has advocated for a review of the objectives to collect data, and to ensure taxonomies and data standards are established.
Members seeking further information or wishing to provide input can contact AIST senior policy advisor Karen Volpato at email@example.com
Update on Productivity Commission survey
The Productivity Commission has written to superannuation funds advising of the re-commencement of the fund survey from the week commencing 6 November. The revised deadline will allow five weeks for funds to respond.
AIST notes that the Commission has addressed many of the issues (raised by the experts that AIST and ISA engaged) relating to the handling of data. However, some issues remain.
The CEO survey has been rescheduled to be sent out in the week beginning 4 December.
Members seeking further information or wishing to provide input can contact AIST head of advocacy Ailsa Goodwin at firstname.lastname@example.org
AIST’s Eva Scheerlinck with ABC’s Fran Kelly on the recent sharemarket high
What’s in store for super fund members as the Australian market hits the 6000 milestone mark?
AIST CEO Eva Scheerlinck spoke to the ABC’s Fran Kelly on the RN Breakfast program this morning about the super outlook, Peter Costello’s proposal for a national default fund, the challenges in front of millennials saving for retirement & more. To listen to the interview click here.
AIST appoints head of advocacy
AIST is pleased to announce the appointment of Ailsa Goodwin to the newly created role of head of advocacy.
Ms Goodwin has more than a decade of experience working in financial services, including various senior management roles at the Australian Securities and Investments Commission (ASIC).
During this time, she led teams responsible for the Future of Financial Advice reforms, Stronger Super reforms and reviews of the regulatory settings for life insurance within and outside superannuation.
AIST CEO Eva Scheerlincksaid Ms Goodwin’s deep understanding of the policy and regulations impacting on the superannuation landscape would add to the already significant pool of talent across AIST’s policy, research and communications team.
“Ailsa’s appointment as head of advocacy will expand AIST’s role in helping shape retirement outcomes and ensuring that consumer interests are always front and centre of any legislative change or new policy outcome,” Ms Scheerlinck said. “Her skills and experience will be critical in these times of intense focus on regulation and governance which includes the greater emphasis on transparency and disclosure across the financial services sector.”
Before joining ASIC, Ms Goodwin worked as an adviser to the customer-owned banking sector and the NSW Law Reform Commission, and as a solicitor at a national law firm in Sydney and Melbourne. She has also worked at Industry Super Australia as senior manager, regulatory policy, and consulted to a range of other organisations within the profit-to-member super sector.
Ms Goodwin’s appointment is effective immediately. Members wishing to discuss AIST’s advocacy work can contact Ailsa on 03 8677 3800 or email@example.com
AIST’s Karen Volpato wins 2017 Woman of the Year Award
AIST senior policy advisor Karen Volpato has been named the 2017 Woman of the Year at the 5th annual Money Management & Super ReviewWomen in Financial Services Awards.
AIST CEO Eva Scheerlincksaid the Award – which celebrates women’s achievements across the financial services sector - was a fitting tribute to Karen’s tireless and passionate work in superannuation policy and research and a long career in championing better retirement outcomes for members.
Ms Scheerlinck said Karen’s recent work on the AIST-Mercer Super Tracker and her very active involvement in the long and complex industry negotiations regarding Regulatory Guide 97 fee and cost disclosure were just two highlights in an outstanding 37-year career in superannuation. During RG97 negotiations, Karen emphasized an objective and principles-based approach, which is gaining consensus across the industry.
“Anyone who knows Karen well knows that her passion for her work is driven by an unwavering commitment to protecting members’ best interests across every aspect of superannuation,” Ms Scheerlinck said.
Throughout her career Karen has championed gender equality, particularly through her work with Women in Super, where she was chair of policy for four years, and also as marketing manager of First State Super where she developed Australia’s first women and super website. As part of her work with the AIST-Mercer Super Tracker, Karen introduced a gender lens to the Tracker to provide an evidence-based assessment on how policy changes might impact on women’s retirement outcomes.
Another career highlight was Karen’s role in overseeing the marketing rollout of First State Super becoming a public offer fund as well as the merger with Health Super.
Karen did her legal articles as the first woman lawyer in a Tasmanian law firm established in the 1880s. Karen began her career working at the Trust Bank, also as the bank’s first woman lawyer. At the Retirement Benefits Fund, she spent a year and a half reviewing all invalidity claim processes with all stakeholders, halving both the claims and reviews. Karen also personally managed the Port Arthur massacre invalidity claims.
David Bell recognised for retirement innovation
Mine Wealth + Wellbeing CIO David Bell has been awarded the BT Investment Management Retirement Innovation Award for his role in developing the Member’s Default Utility Function (MDUF V1).
The Member’s Default Utility Function is an open-architecture metric which was developed by a panel of academics and industry professionals to assist the industry in providing retirement outcome modelling.
Mr Bell said that the Award – which he received at the Superratings’ awards dinner in Melbourne last month – reflects Mine’s significant focus and support in developing superior retirement outcome solutions.
“It was made possible through the hard work and collaboration of the entire Member’s Default Utility Function working group and their role in developing this powerful metric has been invaluable,” he said. “I am truly humbled and it demonstrates the genuine need in the industry for a
Papers, presentations, models and FAQs in relation to MDUF v1 are available at the AIST website and at the membersdefaultutilityfunction.com.au.