The Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No 2) Bill 2017 has passed the House of Reps without amendment. It proposes the following amendments to the Superannuation Guarantee (Administration) Act 1992 (SGAA):
- salary sacrifice integrity – employers will be prevented from using an employee’s salary sacrifice contributions to reduce the employer’s own minimum 9.5% super guarantee (SG) contributions; and
- choice of super fund – to be extended to employees covered by new enterprise agreements and workplace determinations made on or after 1 July 2018.
The report of the Senate Economics Legislation Committee on the Bill has now been released and it recommended the Bill be passed. Labor Senators however, recommended that the Bill be amended in the Senate so as to:
- ensure there are no impediments to collective bargaining that would lift superannuation arrangements beyond the community standard; and
- ensure that sufficient safeguards exist when workers exercise choice of fund.
Labor Senators reserved their final voting position on the Bill depending on the outcome of such amendments.
Independent directors etc
The Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No 1) Bill 2017 and the Superannuation Laws Amendment (Strengthening Trustee Arrangements) Bill 2017 were both introduced in the Senate on 14 October 2017. They were both referred to the Senate Economics Legislation Committee which has now released its report.
The Accountability No 1 Bill proposes a range of amendments:
(i) amend the SIS Act to strengthen the obligation on superannuation trustees to consider the appropriateness of their MySuper product offering annually;
(ii) give APRA an enhanced capacity to refuse a registerable superannuation entity (RSE) licensee a new authority to offer a MySuper product or to cancel an existing authority;
(iii) amend the SIS Act to impose civil and criminal penalties on directors of RSE licensees who fail to execute their responsibilities to act in the best interests of members, or who use their position to further their own interests to the detriment of members.
The Strengthening Trustee Arrangements Bill proposes to require all trustees of registrable superannuation entities (RSE licensees) to have a minimum of one-third independent directors on their trustee board, and an independent Chair. The amendments would replace the existing equal representation rules.
The Senate Committee report recommended that the Senate pass the Bills. However, in a dissenting report, Labor Senators recommended that the Strengthening Trustee Arrangements Bill be opposed, and that the Measures No 1 Bill also be opposed “unless the Bill applies consistently and comprehensively across the superannuation system”.
[APH website – bills digest: Accountability No. 1 Bill, Accountability No. 2 Bill, Trustee Arrangements Bill, Senate report on No.1 Bill & Trustee Arrangements Bill, Senate report on No.2 Bill; LTN 204, 25/10/17]; TM Oct 2017]