Revised Explanatory Memorandum
(Circulated by the authority of the Minister for Financial Services and Superannuation, the Hon Bill Shorten MP)General outline and financial impact
Stronger Super
On 16 December 2010, the then Assistant Treasurer and Minister for Financial Services and Superannuation, the Hon Bill Shorten MP, announced the Stronger Super reforms.
Stronger Super represents the Government's response to the review of the governance, efficiency, structure and operation of Australia's superannuation system, the Super System Review (the Review). The Government released the Review's final report on 5 July 2010 and its response on 16 December 2010 (Minister's Media Release No. 024 of 16 December 2010).
To obtain input on the design and implementation of the Stronger Super reforms, the Government undertook extensive consultation with industry, employer and consumer groups. The Government announced its decisions on the key design aspects of the Stronger Super reforms on 21 September 2011 (Minister's Media Release No. 131 of 21 September 2011).
This Bill is the fourth and final tranche of legislation implementing the Government's MySuper and governance reforms as part of Stronger Super. The Legislative and Governance Forum for Corporations has been notified of the Bill as per section 506 of the Corporations Agreement, and the Bill does not require forum approval as it is exempt under section 507 of the Corporations Agreement.
The Bill has been considered by the Parliamentary Joint Committee on Corporations and Financial Services (PJC), which reported on 5 February 2013.
The first tranche of legislation, the Superannuation Legislation Amendment (MySuper Core Provisions) Act 2012 (MySuper Core Provisions Act), received Royal Assent on 28 November 2012.
The second tranche of legislation, the Superannuation Legislation Amendment (Trustee Obligations and Prudential Standards) Act 2012 (Trustee Obligations and Prudential Standards Act) received Royal Assent on 8 September 2012.
The third tranche of legislation, the Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Act 2012 (Further MySuper and Transparency Measures Act) received Royal Assent on 3 December 2012.
Date of effect: The majority of the provisions will take effect from 1 July 2013. The new section 58B will commence on Royal Assent, and the amendments to sections 29WA and 29WB will commence the day after Royal Assent. Provisions relating to the renaming of Fair Work Australia will generally commence with effect from 1 January 2013. Changes relating to dual regulated entities will apply from 1 July 2015.
Proposal announced: On 16 December 2010, the Minister announced the Government would implement the Stronger Super reforms. Following consultation, on 21 September 2011, the Minister announced the key design aspects of the Stronger Super reforms.
Financial impact: Nil.
Human rights implications: The human rights issues this Bill raises are explained in the Statement of Compatibility with Human Rights - Chapter 7.
Summary of regulation impact statement
Regulation impact on business
Impact: The regulation impact statement (RIS) for Stronger Super implementation can be found at http://ris.finance.gov.au. The relevant sections of the RIS covered in this Bill are MySuper and governance of superannuation (including section 4.4 in the appendix). A RIS exemption was granted for the remainder of the Stronger Super reforms, which will be subject to a post-implementation review.