Welcome to the latest issue of the KHQ Super Alert. This week the Attorney-General released the Privacy Act Review Report outlining significant proposals for reform, Treasury released for consultation the Government’s proposal to legislate the objective for superannuation, and ASIC encouraged trustees to review and uplift their IDR processes.
APRA – Re-issue of 2022 MySuper Heatmap and FAQs
On 24 February 2023, APRA re-issued its MySuper Heatmap for 2022. According to APRA, amendments have been made ‘to ensure that international index data is correctly reflected in the relevant investment and performance test metrics’. The update has not ‘resulted in any changes to the products identified as having poor performance or significantly poor performance in December 2022’ or the August 2022 annual performance test determinations (see our Super Alerts from 2 September 2022 and 16 December 2022).
Click here for details.
ASIC – Speech on trustee IDR processes and better outcomes for members
On 22 February 2023, ASIC released a speech given by ASIC Commissioner Danielle Press encouraging trustees to promote good member outcomes and ‘critically examine their dispute resolution arrangements’ and ‘ensure they are fit-for-purpose’.
The speech highlighted results found in ASIC’s review of the internal dispute resolution (IDR) practices of 35 trustees (see our Super Alert from 12 August 2022).
Ms Press said that IDR was one area in which trustees could ‘do more to deliver for their members’, encouraging trustees not to have a ‘compliance only mindset – doing the bare minimum to meet specific legal obligations’, but that trustees ‘need to move beyond this’ and ensure members are at the ‘heart of decision-making’.
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Treasury – Speech in relation to purpose of superannuation
On 21 February 2023, Treasury released a speech given by the Assistant Treasurer and Minister for Financial Services the Hon Stephen Jones MP titled Preservation is superannuation. Mr Jones discussed the consultation paper relating to legislating the objective of superannuation released on 20 February 2023 (see below) saying, ‘the objective of superannuation needs to be simple and solely focussed on bettering and ensuring retirement incomes’. He touched on lifting the performance of superannuation, noted that preservation is a ‘core principle of the system’, and that the MySuper annual performance test is ‘here to stay’.
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ASIC – Advice company convicted of hawking in superannuation rollover calls
On 21 February 2023, ASIC issued a media release announcing that on 20 February 2023, a financial planning company had pleaded guilty to one count of breaching anti-hawking laws and the Court had imposed a $70,000 penalty. According to ASIC, in the 2019/20 financial year the company had ‘made unsolicited calls to consumers encouraging them to roll over their superannuation into different superannuation products’, and they ‘charged an initial fee for the rollover as well as ongoing fees’.
ASIC Deputy Chair Sarah Court is quoted as saying ‘[r]eforms to the anti-hawking regime were [introduced] in response to clear consumer harm when it came to the unsolicited calls involving financial products. ASIC strongly advocated for these reforms and will continue to pursue action in the court where we see a disregard for these laws’.
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Treasury – Consultation on legislating the objective of superannuation
On 20 February 2023, Treasury released a consultation paper titled Legislating the objective of superannuation, which outlines the Government’s proposed objective of superannuation and its rationale behind the wording. The proposed objective of superannuation is ‘to preserve savings to deliver income for a dignified retirement, alongside government support, in an equitable and sustainable way .’
The Treasurer, the Hon Dr Jim Chalmers MP, and the Assistant Treasurer and Minister for Financial Services, the Hon Stephen Jones MP also issued a related media release saying, this ‘will give confidence to the super industry and peace of mind to Australian workers that we’ll do everything we can to safeguard their savings to deliver income in retirement’.
Consultation will end on 31 March 2023.
Click here, here and here for details.
Treasury – Speech on super and financial advice
On 20 February 2023, the Treasurer, the Hon Dr Jim Chalmers MP gave a speech discussing Super and the future. The speech covered several related topics including financial advice, digital technology in super, the government’s response to the changes in super, its ‘move to end the super wars’ by legislating the objective of superannuation, and the need to make the super system as ‘equitable and sustainable as it can be’.
In terms of financial advice, the Treasurer explained that the government is working ‘to provide a clear path for experienced advisers to stay in the industry and for new entrants to come in’ (in conjunction with the Quality of Advice Review). The Government is also hoping to ‘create the right conditions’ to develop ‘a cyber strategy that will create the safe and secure environment required for digital [financial advice] services to expand’.
Click here for details.
Attorney-General – Report proposing privacy reforms released
On 16 February 2023, the Attorney-General’s department released for consultation the Privacy Act Review – Report. This report outlines proposed reforms which are ‘aimed at strengthening the protection of personal information and the control individuals have over their information’.
The 320-page report sets out 116 proposed reforms which are the result of a two-year review of the Privacy Act 1988 (Cth) (the Act). At a high level, some of these proposals include:
- a new ‘fair and reasonable’ test which is proposed to ‘underpin the activities of APP entities when handling personal information’ (ie, this would be an objective test to ensure the ‘handling of personal information is within individuals’ reasonable expectations and is not harmful’);
- clarifying that ‘personal information is an expansive concept which includes technical and inferred information’;
- introducing a number of ‘rights of the individual’ covering seven broad areas: a right to access and request an explanation about their personal information; a right to object; a right to erasure (with appropriate exceptions); a right to correction; a jurisdictionally limited right to ‘de-index online search results containing personal information’; several exceptions to all of these individual rights (e.g., ‘competing public interests’, competing legal interests, and ‘technical exceptions’); and a right to a response where an entity ‘must take reasonable steps to respond to an exercise of a right of an individual’;
- ‘significant reforms to strengthen the enforcement of the Act including new civil penalties and new powers for the [OAIC] in relation to investigations, public inquiries and determinations’; and
- streamlining privacy obligations and proposals to minimise the duplication of privacy and reporting obligations currently set out in different legislative frameworks.
Consultation will end on 31 March 2023.
Click here for details.
This alert was written by Kiara Leslie (Lawyer), Sanela Osmanovic (Senior Associate), and Natalie Cambrell (Director).
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