The new Rudd Labor Government will act as soon as practicable to reunite millions of Australians with their lost super account following the release of details of new lost accounts and monies for 06/07.
Minister Sherry will be convening a meeting with superannuation representatives early in 2008 to consult on practical solutions to reduce the level of lost accounts.
This will include consideration of the implementation issues that Labor proposed to "auto roll" together lost accounts into a member's last active account using the Tax File Number system.
This far simpler solution would remove red tape and complexity
Senator Sherry said "I am extremely concerned the 2007 Australian Tax Office (ATO) Annual Report has shown lost superannuation has blown out from $9.7 billion in 2005-06 to $11.9 billion in 2006-07; This is a shocking $2.2 billion increase in one year".
This increase is after an extensive ATO mail out of three million letters over two years removing $2.73 billion from the register.
The number of accounts also increased significantly from 5.7 million to 6.1 million over the same period – 400,000 extra accounts lost in one year.
"One in two working Australians now has a "lost" account. Australians having more than one account are paying double or triple fees.
It is a major, inefficient and complex hole in our super system that has been left untouched by the former Howard Government and has been growing rapidly every year.
Millions of Australians will never find their lost account and are paying multiple fees on multiple accounts, Senator Sherry said."
In July 1998 there were 2.2 million lost accounts with $1.8 billion in lost super, nine years later there are 6.1 million lost accounts with $11.9 billion in lost super. A 600% increase in lost super and rising.
The current system of "rolling together" is too complex and costly– finding the fund, form filling, advice and providing necessary identification.
After 11 ½ long years the previous Howard Government let the problem grow and grow.
We've had Super Match, Super Online, Super Seeker and the 'send out a form' in the 2006 Budget package together with major government propaganda (advertising) campaigns.
Portability and Choice of Super were also claimed to be solutions however the former has always existed for people with lost super (where not locked in by an exit fee) and the latter operational in 2005/06.
Senator Sherry said "A Rudd Labor Government will reunite Australians with their lost super. Labor has argued for years that lost accounts should be automatically rolled together using Tax File Numbers (TFN)."
A lost superannuation account is an account that has received no contribution for two years. The super funds send out a statement to the last known address of the individual and if the statement comes back returned – address unknown then at the end of the two year period it is declared lost because there is no further contact with that individual.
Number and dollar value of lost super accounts from 2001 - 2006
