Retirement
New super choice form could remove consumer protections
The proposed model for a new digital superannuation choice form for new employees contains less information than existing paper forms, posing a potential risk for super fund members.
New super choice form could remove consumer protections
The proposed model for a new digital superannuation choice form for new employees contains less information than existing paper forms, posing a potential risk for super fund members.
As part of the introduction of the Single Touch Payroll (a new reporting system for businesses with more than 20 employees, which comes in to effect July 2018), the Australian Taxation Office (ATO) is looking to introduce a new digital form for employees to choose their super fund.
David Haynes, a senior policy manager with industry lobby group Australian Institute of Superannuation Trustees (AIST), said the ATO’s proposed form “has a number of flaws” and shouldn’t be introduced until the industry is satisfied the form “will not disadvantage members”.
“If implemented under the proposed model, the form will remove important existing consumer protections and potentially display incomplete, out-of-date and misleading information to members,” he said.
Mr Haynes said the proposed form includes less information than the paper forms currently in use, and notably don’t require employers to list their default fund on the form.
“We know that many super fund members do not actively choose their super fund,” he said.
“The name of the default fund is pre-populated on the existing paper-based choice form, removing this function is a step backward for disclosure.”
Mr Haynes said the introduction of the new form should be decoupled from the implementation of the government’s Single Touch Payroll and instead should not be brought into effect before July 2019, after more consumer testing can be conducted.
A spokesperson for the ATO told Nest Egg that it has undergone “extensive design and consultation” with the super industry over several months, and recently issued a consultation paper asking for submissions from industry bodies.
“The paper provided an opportunity for all interested parties to provide feedback on the design principles, whether the design supports the policy intent, and to raise any unintended consequences,” the spokesperson said.
“The 28-day consultation period has just concluded with a number of submissions provided by industry.”
These submissions – including one from the AIST — are currently under review, the spokesperson said, and the ATO is considering how these might impact the current design.
“We expect this process to conclude before the end of this month,” they said.
RELATED ARTICLES
Superannuation
Superannuation guarantee rate rises to 12 per cent as parental leave changes take effect
The superannuation guarantee rate has increased from 11.5 per cent to 12 per cent from Tuesday, with super contributions also being added to Commonwealth Parental Leave Pay for the first time. Read more
Superannuation
Rest's Sustainable Growth option achieves highest sustainability classification
Rest superannuation fund has achieved the highest sustainability classification for its Sustainable Growth investment option from the Responsible Investment Association Australasia. Read more
Superannuation
Aware Super slashes admin fees for retirees by up to 25 per cent
Aware Super has reduced administration fees for members with a retirement income account by up to 25 per cent and lowered the maximum annual fee. Read more
Superannuation
SuperAPI co-founder criticises Labor's superannuation tax as 'sneaky tax on young people'
The co-founder of SuperAPI has labelled Labor's proposed tax on superannuation balances above $3 million as a "sneaky tax on young people, tomorrow" disguised as a policy targeting wealthy retirees ...Read more
Superannuation
Election policies could reshape Australia's superannuation landscape, expert warns
Competing superannuation policies from Australia's major political parties could have significant implications for investors and retirees, according to a financial expert. Read more
Superannuation
Industry leaders weigh in on concessional super tax as Budget confirms $55bn investment
Changes to the taxation of superannuation earnings and contributions have drawn mixed responses from financial and payroll sector leaders, as the Federal Budget confirms over $55 billion in ...Read more
Superannuation
Call for indexation on super tax cap as $3m threshold draws criticism
A senior executive in the superannuation technology sector has criticised the Federal Government for failing to index the proposed $3 million superannuation tax cap, arguing the measure will unfairly ...Read more
Superannuation
Rest members back calls for fairer superannuation rules ahead of Federal Budget
Rest has called on the Federal Government to implement superannuation reforms aimed at improving fairness across the system, after member survey results showed strong support for a range of proposed ...Read more
Superannuation
Superannuation guarantee rate rises to 12 per cent as parental leave changes take effect
The superannuation guarantee rate has increased from 11.5 per cent to 12 per cent from Tuesday, with super contributions also being added to Commonwealth Parental Leave Pay for the first time. Read more
Superannuation
Rest's Sustainable Growth option achieves highest sustainability classification
Rest superannuation fund has achieved the highest sustainability classification for its Sustainable Growth investment option from the Responsible Investment Association Australasia. Read more
Superannuation
Aware Super slashes admin fees for retirees by up to 25 per cent
Aware Super has reduced administration fees for members with a retirement income account by up to 25 per cent and lowered the maximum annual fee. Read more
Superannuation
SuperAPI co-founder criticises Labor's superannuation tax as 'sneaky tax on young people'
The co-founder of SuperAPI has labelled Labor's proposed tax on superannuation balances above $3 million as a "sneaky tax on young people, tomorrow" disguised as a policy targeting wealthy retirees ...Read more
Superannuation
Election policies could reshape Australia's superannuation landscape, expert warns
Competing superannuation policies from Australia's major political parties could have significant implications for investors and retirees, according to a financial expert. Read more
Superannuation
Industry leaders weigh in on concessional super tax as Budget confirms $55bn investment
Changes to the taxation of superannuation earnings and contributions have drawn mixed responses from financial and payroll sector leaders, as the Federal Budget confirms over $55 billion in ...Read more
Superannuation
Call for indexation on super tax cap as $3m threshold draws criticism
A senior executive in the superannuation technology sector has criticised the Federal Government for failing to index the proposed $3 million superannuation tax cap, arguing the measure will unfairly ...Read more
Superannuation
Rest members back calls for fairer superannuation rules ahead of Federal Budget
Rest has called on the Federal Government to implement superannuation reforms aimed at improving fairness across the system, after member survey results showed strong support for a range of proposed ...Read more
