The Assistant Treasurer, Senator Rod Kemp, has asked the Productivity Commission (PC) to commence the scheduled National Competition Policy (NCP) Legislation Review of the Superannuation Industry (Supervision) Act 1993 and certain other superannuation related legislation and report within nine months.
The PC inquiry forms part of a comprehensive review of existing legislation that the Commonwealth committed to undertake when, along with all Australian Governments, it signed the Competition Principles Agreement in 1995. The Treasurer published the Commonwealth Legislation Review Schedule in June 1996. All Commonwealth legislation that restricts competition or imposes costs on business is being evaluated against the guiding principle that it should be retained only if the benefits to the community as a whole outweigh the costs and if objectives of the legislation cannot be achieve more efficiently through other means, including non-legislative approaches.
The review will encompass six pieces of legislation relating to superannuation:
- Superannuation (Self Managed Superannuation Funds) Taxation Act 1987;
- Superannuation (Self Managed Superannuation Funds) Supervisory Levy Imposition Act 1991;
- Superannuation (Resolution of Complaints) Act 1993;
- Superannuation Industry (Supervision) Act 1993;
- Occupational Superannuation Standards Regulations Applications Act 1992; and the
- Superannuation (Financial Assistance Funding) Levy Act 1993.
The review will not address taxation issues affecting the superannuation industry, other than the levies identified, nor will it include provisions of the Superannuation Industry (Supervision) Act 1993 that have recently been subjected to regulation review or a regulation impact assessment, such as the provisions dealing with the supervision of self managed funds, the superannuation investment rules and provisions covered by the draft Financial Services Reform Bill.
As this review is required by the Commonwealth’s NCP obligations, it does not signal any change to the Government’s policies relating to superannuation.
The PC will shortly release an issues paper and invite expressions of interest from anyone wanting to participate in the review. I encourage all interested parties to make submissions to the Commission and attend its public hearings.
The terms of reference for the review are attached.
CANBERRA
7 February, 2001
Media contact: Richard Allsop Assistant Treasurer’s Office (02) 6277 7360 Raphael Cicchini Treasury (02) 6263 3205
Review of certain Superannuation Acts within the Treasury portfolio
PRODUCTIVITY COMMISSION ACT 1998
I, ROD KEMP, Assistant Treasurer, pursuant to Parts 2 and 3 of the Productivity Commission Act 1998, hereby refer the attached list of legislation and associated regulations, relating to superannuation, to the Commission for inquiry and report within 9 months of receipt of this reference. The Commission is to focus on those parts of the legislation that restrict competition, or that impose costs or confer benefits on business. The Commission is to hold hearings for the purpose of the inquiry.
Background
- This review fulfils a commitment made in the Commonwealth Legislation Review Schedule to undertake National Competition Policy reviews of these Acts. This review will not be addressing taxation issues affecting the superannuation industry, other than levies referred to in the attached Schedule.
Scope of Inquiry
- The Commission is to report on appropriate arrangements for regulation taking into account the following:
- legislation/regulation which restricts competition should be retained only if the benefits to the community as a whole outweigh the costs; and if the objectives of the legislation/regulation can be achieved only by restricting competition. Alternative approaches which may not restrict competition include quasi-regulation and self-regulation.
- in assessing the matters in (a), regard should be had, where relevant, to effects on the environment, welfare and equity, occupational health and safety, economic and regional development, consumer interests, the competitiveness of business including small business, and efficient resource allocation.
- the need to promote consistency between regulatory regimes and efficient regulatory administration, through improved coordination to eliminate unnecessary duplication.
- there should be explicit assessment of the suitability and impact of any standards referenced in the legislation, and justification of their retention if they remain as referenced standards.
- compliance costs and the paper work burden on small business should be reduced where feasible
- In making assessments in relation to the matters in (3), the Commission is to have regard to the analytical requirements for regulation assessment by the Commonwealth, including those set out in the Competition Principles Agreement. The report of the Commission should:
- identify the nature and magnitude of the social, environmental or other economic problem(s) that the legislation seeks to address;
- clarify the objectives of the legislation;
- identify whether, and to what extent, the legislation restricts competition;
- identify relevant alternatives to the legislation, including non-legislative approaches;
- analyse and, as far as reasonably practical, quantify the benefits, costs and overall effects of legislation and alternatives identified in (d);
- identify the different groups likely to be affected by the legislation and alternatives;
- determine a preferred option for regulation, if any, in light of objectives set out in 3; and
- examine mechanisms for increasing the overall efficiency, including minimising the compliance costs and paper burden on small business, of the legislation and, where it differs, the preferred option.
- The Commission should take account of any recent substantive studies relevant to the inquiry.
- In undertaking the review, the Commission is to advertise nationally and consult with key interest groups and affected parties.
- The Government will consider the Commission’s recommendations, and the Government’s response will be announced as soon as possible after the receipt of the Commission’s report.
ROD KEMP
Schedule
The following Acts and their associated Regulations are to be reviewed:
- Superannuation (Self Managed Superannuation Funds) Taxation Act 1987
- Superannuation (Self Managed Superannuation Funds) Supervisory Levy Imposition Act 1991
- Superannuation (Resolution of Complaints) Act 1993
- Superannuation Industry (Supervision) Act 1993 — excluding provisions dealing with:
-
- those aspects of the regulation and supervision of self managed superannuation funds that were covered by Superannuation Legislation Amendment Act (No. 3) 1999 and subsequent Regulations;
- the superannuation investment rules (section 66 and Part 8 of the Act); and
- matters covered by the draft Financial Services Reform Bill (previously CLERP 6).
- Occupational Superannuation Standards Regulations Applications Act 1992
- Superannuation (Financial Assistance Funding) Levy Act 1993
- Superannuation (Resolution of Complaints) Act 1993
- Superannuation (Self Managed Superannuation Funds) Supervisory Levy Imposition Act 1991