Welcome to the latest issue of the KHQ Super Alert. This week, Treasury released draft legislation to enact the ‘better targeted superannuation concessions’ policy change, APRA issued two quarterly statistics publications and APRA and ASIC jointly released a FAR information package.
APRA – Quarterly superannuation statistics
On 5 October 2023, APRA released the quarterly superannuation industry publication and the quarterly superannuation product statistics for the quarter ending June 2023. Some key statistics include that as of 30 June 2023:
- there were 64 MySuper products, 534 accumulation choice products, and 403 retirement products (including transition to retirement);
- there were over 14.2 million MySuper member accounts, 6 million accumulation choice product member accounts, and 1 million retirement phase member accounts; and
- the average member account balance had increased to $64,000 for MySuper products, $113,000 for accumulation choice products, and $326,000 for retirement products (excluding transition to retirement).
Click here and here for details.
APRA – Updates to SDT FAQs
On 4 October 2023, APRA published two additional frequently asked questions (FAQs) and made updates to three existing FAQs and worked examples in relation to the superannuation data transformation (SDT) project (see our Super Alerts from 25 February 2022 and 2 September 2022 about the SDT project).
Click here for details.
Treasury – Draft legislation for better targeted superannuation concessions
On 3 October 2023, Treasury released for consultation two pieces of exposure draft legislation and explanatory materials to enact the Better Targeted Superannuation Concessions policy change previously announced (see our Super Alerts from 3 March 2023 and 6 April 2023).
The Treasury Laws Amendment (Better Targeted Superannuation Concessions) Bill 2023 and the Superannuation (Better Targeted Superannuation Concessions) Imposition Bill 2023 will reduce ‘the tax concessions for individuals with a total superannuation balance … above $3 million by imposing an additional 15 per cent tax on certain earnings under a new Division 296 of the Income Tax Assessment Act 1997’. Several other pieces of legislation will also be amended to accommodate this change.
The Treasurer, the Hon Dr Jim Chalmers MP and the Assistant Treasurer and Minister for Financial Services, the Hon Stephen Jones MP issued a joint media release announcing the draft legislation.
Consultation will close on 18 October 2023.
Click here, here, and here for details.
APRA/ASIC – FAR information package
On 3 October 2023, APRA and ASIC issued a joint media release informing the financial services industry that they have jointly published an information package aimed at supporting entities to implement the financial accountability regime (FAR).
The information package includes:
- APRA and ASIC’s joint administration agreement, which sets out ‘the framework within which the regulators will work together to administer the FAR’; and
- ‘a joint information paper providing guidance for ADIs on transitioning from the [Banking Executive Accountability Regime] to the FAR’.
FAR will come into force for the superannuation industry on 15 March 2025.
Click here and here for details.
Attorney-General – Government’s response to the Privacy Act Review Report
On 28 September 2023, the Government released its response to the Privacy Act Review – Report which was released by the Attorney-General’s department earlier this year (see our Super Alert from 24 February 2023). In the report titled Government Response – Privacy Act Review Report, the Government Agrees with 38 of the proposals, Agrees in-principle with 68 of the proposals, and Notes 10 of the proposals.
Whilst the Government agreed in-principle with many of the proposals relevant to superannuation trustees, the Government more definitively agreed with the proposals aimed at strengthening enforcement. These proposals include amending the Privacy Act 1988 (Cth) to:
- remove the word ‘repeated’ from section 13G which deals with ‘serious or repeated’ breaches and clarify that a ‘serious’ interference can include repeated interferences with privacy;
- create ‘a new mid-tier civil penalty provision […] to cover interferences with privacy which do not meet the threshold of being ‘serious’; and
- create ‘a new low-level civil penalty provision for specific administrative breaches of the Act and APPs … which would include infringement notice powers for the Information Commissioner with set penalties’.
Click here for details.
Legislation – Social and affordable housing package receives Royal Assent
On 28 September 2023, the Housing Australia Future Fund Act 2023 and the Treasury Laws Amendment (Housing Measures No. 1) Act 2023 received Royal Assent and were subsequently registered on the Federal Register of Legislation. The legislation seeks to implement the Government’s budget announcements concerning investment in social and affordable housing and establishes the Housing Australia Future Fund. See our Super Alert from 15 September 2023 for further information.
Click here and here for details.
NSW Court of Appeal – TPD decision – member not ‘at work’ on insurer changeover date
On 28 September 2023, the New South Wales Court of Appeal handed down its decision in Hart v MetLife Insurance Ltd [2023] NSWCA 230. The appellant held insurance cover for total and permanent disablement (TPD) through her superannuation fund with MetLife Insurance Ltd (MetLife) from 1 July 2005 until the policy was terminated on 30 September 2011 and replaced by a policy issued by TAL Life Ltd.
MetLife remained on risk for certain claims made after that changeover, such as TPD claims arising from an injury or illness which had caused a member to be not ‘at work’ on 30 September 2011. The appellant was not ‘at work’ on that date, but then returned to work. She had a subsequent absence between December 2014 and June 2015 and thereafter made a TPD claim under the MetLife policy due to injuries which she said were the same as those that caused her to be not ‘at work’ on 30 September 2011. MetLife denied being on risk for this claim.
The primary judge found that MetLife’s conduct had not breached its duties to act in good faith and fairly when considering and responding to her claim and then dismissed the whole of the proceedings.
One of the principal issues raised in the appeal was ‘whether the primary judge erred in making an order disposing of the whole of the proceedings’. The Court allowed the appeal. In the main, this was because MetLife had asked the Court to determine questions which were directed to alleged breaches of duty rather than to whether MetLife remained ‘on risk’ for the claim, so there was no basis on which answering those separate questions could substantially dispose of the claim.
Click here for details.
This alert was written by Kiara Leslie (Lawyer) and Natalie Cambrell (Director).
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