Your Future, Your Super package
The government has released exposure draft materials for public consultation to implement measures in the Your Future, Your Super package of reforms announced in the 2020–21 Budget.
The exposure draft legislation includes amendments for the following:
- Single default account — The draft Bill amends the Superannuation Guarantee (Administration) Act 1992 to limit the creation of multiple superannuation accounts for new employees. Employers will be required to make contributions to an employee’s existing fund, where a new employee has one and does not choose a fund to receive contributions. The proposed amendments will apply the day after the date of assent of the amending legislation.
- Discharging best financial interest duties obligation — The draft Bill amends the Superannuation Industry (Supervision) Act 1993 (SIS Act) to require trustees and directors of corporate trustees of superannuation funds to perform their duties and powers in the best financial interests of the beneficiaries. The amendments will also allow regulations to be made to specify certain payments that are prohibited unless certain conditions are met. The proposed amendments will apply the day after the date of assent of the amending legislation.
- Addressing underperformance in superannuation — The draft Bill amends the SIS Act to require APRA to conduct an annual performance test for MySuper products and other products to be specified in regulations. Where a product fails the performance test, a trustee will be required to give notice to its beneficiaries. Where a product fails the performance test in 2 consecutive years, no new beneficiaries can be accepted into the product. The amendments will also allow regulations to be made on the formulas used by APRA for ranking superannuation products. The proposed amendments relating to the new annual performance test for MySuper products will apply on and after 1 July 2021 and in relation to other products specified in regulations on and after 1 July 2022.