While the implementation of MySuper is only a couple of months away, a number of elements of the reform package remain unsettled, says David Haynes, project director at AIST.
Presenting at CMSF yesterday, Haynes said of most concern to super funds should be APRA data-reporting requirements, product dashboards, SuperStream, ATO SuperSeeker and account consolidation, among other requirements.
“There’s a whole host of issues here that remain substantially unresolved. These have both immediate operational impacts and longer-term structural impacts,” he said.
In particular, Haynes said all information reported to APRA forms the basis for other uses of that data, including as the data feed for product dashboards. Haynes believes this will involve a review of fund calculators and documentation.
“This will necessarily also focus the attention of people on data quality. And that will be underlined when the regulators start to compare the information that’s been reported through the APRA data-reporting standards with the data that is reported to the ATO through the member-contribution statements,” Haynes said.
“I think this is an enormous sleeper issue and we can probably expect to see more sessions about this at forthcoming CMSFs.”
Haynes said the fourth tranche of MySuper amendments was only introduced to Parliament yesterday, leaving some elements of the reforms undecided.
“From my perspective, I’ve been buried in the detail of MySuper now for two years, and from AIST’s perspective, we’ve been heavily involved in negotiations upstream with treasury and the regulators and other industry associations, and pretty heavily involved downstream in terms of putting together consultative mechanisms…”
Haynes warned that super funds may get too tied up in the immediate next stage of MySuper, focused on the administrative and resource hurdles they have to overcome.
“They are real [and significant] issues, but I also think it’s important that people look at the whole Stronger Super package from the perspective of what is best for the long term of the superannuation industry, and of course, most significantly, the members that we serve.”
In his talk, Haynes considered how the different elements of Stronger Super fit together and identified a number of emerging and unexpected issues.
He said the general view is that MySuper will not make a difference, but argues that it’s only one part of an overall Stronger Super package.
“And so outcomes like increasing the SG to 12 per cent, no commissions in super, revolutionising the back office – these are all actually fundamental and critically important developments in relation to superannuation. And raising standards in super, particularly in relation to the default product, is an absolutely key element of that. If the not-for-profit sector is already at that standard, well and good. But if we can bring the whole of the sector up to that same standard… that’s a good thing.”
|Day 2 newsletter from CMSF 2013|
|Day 1 newsletter from CMSF 2013|