Implementing SuperStream begins with talking with employers. To reunite lost superannuation accounts with members and deliver the purported billions in administration savings this will bring requires tax file numbers (TFNs). And employers know these identifiers. “The rot in the fund data chain starts with the member providing data to the employer,” Graham Sammells, CEO of IQ Business Group, an operations consultant to super funds, told the 2010 Superannuation Administration Symposium, which was recently convened by the Australian Institute of Superannuation trustees (AIST) in Melbourne. Sammells said the industry should first concentrate on gathering cleaner data and TFNs from employers before attempting to streamline fund administration systems.
Making TFNs the key member identifier would enable funds to make great headway in the ongoing struggle to aggregate the multiple accounts held by members. The large number of “lost members” and multiple accounts were exacting big costs on the superannuation system, said Sandy Grant, former CEO of Cbus and a panellist on the recently finished Cooper Review of the superannuation system. Fiona Reynolds, CEO of AIST, says these costs amassed to a $13 billion “lostsuper problem”. The system currently hosts about 36 million accounts, Grant says, well above the national population or workers and retirees. “The cost of Australians having three or four accounts is horrific,” he says, explaining that the total number of accounts was reduced to 21 million, about $400 million would be recouped in the system.
“We want employers to provide names, addresses, dates of birth and TFNs of staff to super funds,” he said. “We want them to provide the TFN of staff members – not just (any) TFN. This is not an unusual imposition.” But if the TFN were used as the primary identifier of members, funds should be able to efficiently verify these numbers gathered from employers with the Australian Tax Office (ATO). This would clearly need to be an online, authenticated service, says Sammells. “It has to be done on a batched basis and it needs to be quick. Those TFNs must be validated to administrators before they go into the system.” Grant also suggests that funds collect the mobile phone numbers of members because they could provide a more reliable means of tracking down lost members than postal addresses.