18 June 2021 - The future of super is one
The federal government has won its hard-fought victory to implement fiercely debated superannuation reforms. Consumer-related Your Future, Your Super measures, first announced in the 2020-21 Federal Budget, comprise:
- ‘Stapling’ of members to their first or existing super fund. They will stay with that super fund when they change jobs unless they actively take steps to switch to another one of their choosing
- New annual performance benchmark tests for MySuper products and other products to be specified in regulations, to address underperformance in superannuation
- Super funds risk not being able to accept new members when they have failed two consecutive performance assessments. The barring will remain in place until APRA is satisfied that the fund has met requirements specified in regulations.
APRA already makes some performance metrics publicly available through its MySuper Product Heatmap.
The testing measures commence on 1 July 2021 for MySuper products, and from 1 July 2022 for other products subject to Treasury consultation on how best to expand the scope of the tests. Super account stapling will commence on 1 November 2021.
The Your Future, Your Super legislation was one of three super-related bills passed by the Senate that same evening. The More Flexible Superannuation Bill enables individuals aged 65 and 66 to make up to three years of non-concessional superannuation contributions under the bring forward rule, while the Self Managed Superannuation Funds Bill brings about a long awaited increase in the maximum number of allowable members in SMSFs and small APRA funds from four to six.