Large funds inactive on co-contributions
The superannuation co-contribution regime has not gained as much penetration as originally envisaged, with at least some of the blame residing with the inactivity of large superannuation funds, according to an Australian National Audit Office (ANAO) report released this week.
The ANAO report, while endorsing the effective administration of the scheme by the Australian Taxation Office (ATO), noted that only around 15 per cent of potential recipients were participating in the scheme and added "a significant number of large funds" were not providing member statements required by the ATO to calculate entitlements.
The audit office report said that while the ATO generally had effectively mitigated known compliance risks and analysed potential risks, it needed to take further action to improve lodgement by key large APRA funds.
It said this was because around 25 per cent of these funds did not lodge member statements in recent years.
"The extent of this non-lodgement raises the risk that significant numbers of individuals have not received a co-contribution to which they would otherwise be entitled," the audit report said.
The ANAO made a number of recommendations on how the co-contribution regime could be better administered, which included more explicit coverage of superannuation administrators and more fully using information obtained from client contact channels, particularly concerning co-contribution complaints and interpretative assistance.
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