Regulator has no 'best practice' on superannuation rollovers
The time taken by some superannuation funds to rollover member deposits may annoy many financial planners, but the Australian Prudential Regulation Authority (APRA) does not collect data on how long it takes and has no view on what represents "best practice".
That is the bottom line of an answer provided to the Parliament in the past few weeks to a question from Tasmanian Liberal Senator, David Bushby.
Bushby had placed a question on the Senate notice paper asking about the status of the requirement for superannuation funds to take less than 30 days to roll money over into a different fund.
He asked what was regarded as best practice and whether industry super funds "generally take significantly longer than the retail fund sector in arranging and administering rollovers?"
APRA responded that a rollover ought normally to occur within 30 days of a request being received but claimed there were some exceptions to this requirement, such as when a trustee had applied for and received relief from APRA.
However the regulatory body said it did not routinely collect data which would allow the collation of all cases of non-compliance.
It said that "anecdotally, there is limited evidence of non-compliance across the industry", adding "sometimes delays are due to members not initially providing all the necessary information that will enable a trustee to process the request".
The APRA answer said that, typically, trustees had service standards built into administration arrangements "which are much lower than the legislative requirement".
"These will vary from fund to fund, but may be as low as five or ten working days for a rollover to another APRA fund, and slightly longer to a self-managed superannuation fund where there are additional processing steps," it said.
"The time taken to process rollover requests can vary for many reasons," the regulator said.
"APRA's focus is on the trustee's process, including monitoring compliance with firstly service standards, and second the legislative requirement, and APRA has not formed a view as to 'best practice'."
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