Choice implementation under way
The Federal Government has announced that it will hold another round of industry consultation on choice of fund, after new draft regulations outlining the implementation of the new regime were issued last week.
The draft regulations were welcomed by the Association of Superannuation Funds Australia, with chief executive Philippa Smith describing them as the first step of what was going to be an intensive implementation period.
"It is clear that Treasury have listened to the industry - these draft regulations reflect comments made by the sector to the November fund consultation paper,” Smith said.
"One issue of concern is the inclusion of RSAs (Retirement Savings Accounts) in the default fund category. We believe that all default funds should offer a life insurance component and RSAs do not.”
"More generally, ASFA believes the insurance arrangements in particular are sensible because they allow for the flexibility of arrangements that currently exist, that is, appropriate insurance cover will be provided and most funds will be able to continue as they are and still be a default fund."
The Assistant Treasurer, Mal Brough, announced on last week that the financial services industry and consumers were being invited to comment on the draft regulations.
The regulations cover areas such as the design of the standard choice form to be provided to employees, the minimum level of death cover to be offered by default funds and the information an employee had to give an employer about their chosen fund.
“This is about making sure we consult with employers, employees and industry groups every step of the way to make the transition to choice a smooth one,” Brough said.
“The standard choice form will provide a guide to the information employees need to consider before choosing a super fund,” he said.
“It will be simple to complete for employers and will explain what an employee has to do to make a choice.”
Brough said the draft regulations had incorporated feedback provided by the financial services sector after the Government has released a choice of fund consultation paper last November.
“The Government is seeking comments on both the draft regulations and standard choice form,” he said.
AUTHOR
Mike Taylor
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