The Morrison Government has passed through the Parliament a comprehensive package of legislation that will further improve outcomes for superannuation members and enhance the powers of the prudential regulator.
The Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 1) Bill 2019 also implements two recommendations of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, as part of the Government’s continued action to restore trust in Australia’s financial sector.
The superannuation sector has grown to over $2.7 trillion in assets. Australians rightly expect the industry to be held to the highest standards of transparency and accountability.
This legislation will help safeguard the retirement savings of millions of Australians and ensure that APRA can take effective action, including addressing underperformance and compliance with the best interests duty in the superannuation industry.
The legislation:
- implements Recommendation 3.6 of the Royal Commission to ban superannuation funds from inducing employers;
- implements Recommendation 3.7 of the Royal Commission to extend civil penalties to superannuation fund trustees, in addition to civil and criminal penalties to directors, for breach of their best interests duty;
- bolsters the Australian Prudential Regulation Authority’s (APRA) powers to take preventative or corrective action where they find that a superannuation fund is not acting in the best interests of members;
- imposes stronger obligations on superannuation funds to meet members’ best interests via the new outcomes assessment;
- makes superannuation funds more transparent and accountable for how they spend members’ money through new reporting of expenses, Annual Members’ Meetings and a portfolio holdings disclosure regime; and
- strengthens APRA’s power over the authorisation process for default MySuper products.
Restoring trust in Australia’s financial sector is part of the Morrison Government’s plan for a stronger economy.