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20 May 13 Regs to repeal member protection standards

Superannuation Industry (Supervision) Amendment Regulation 2013 (No 2) was made on 16 May 2013 and registered on the Federal Register of Legislative Instruments on 16 May 2013 as Select Legislative Instrument 2013 No 86.

On 16 December 2010 the Government announced the Stronger Super package of reforms in response to recommendations of the Super System Review.  Following extensive consultation, on 22 October 2012 the Government announced it would repeal the member protection standards from 1 July 2013.

This regulation amends the Superannuation Industry (Supervision) Regulations 1994 to implement a recommendation of the Super System Review to repeal the member protection standards.

Instead, the new MySuper fees rules, which are to commence on 1 July 2013, will require that all MySuper members be charged fees on the same basis, a requirement that cannot be met at the same time as the member protection standards, which require fees for small balances to not exceed the investment earnings on the overall account.

From 1 July 2013, superannuation funds will transfer small inactive accounts to the ATO, which will protect these accounts from being eroded by fees and charges.  Interest will paid on these accounts at a rate equivalent to CPI inflation.  Members will be able to reclaim these account balances from the ATO at any time.

The regulation will have effect from 1 July 2013.

For a copy of the Explanatory Statement, click on the Explanatory Statement tab.

 


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