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Review (Treasury)
Quality of Advice Review
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Consistent with recommendations 2.3, 2.5 and 2.6 of the Final Report of the Hayne Royal Commission, the Government is commissioning this Review which will consider how the regulatory framework could better enable the provision of high quality, accessible and affordable financial advice for retail clients.
The Review (‘QAR’) will not make recommendations on:
- professional standards for financial advisers
- Royal Commission Recommendations 2.7 to 2.10
- changes to the definitions of ‘retail client’, ‘wholesale client’, and ‘sophisticated investor’
- financial services redress arrangements or
- the application of taxation and privacy laws to financial advice
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Released 11 March 2022.
A report will be provided to the Government by 16 December 2022.
AIST has provided a submission for this consultation.
A further consultation, to which AIST will be making a Submission, relates to Conflicted Remuneration in the context of the provision of Financial Advice.
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Review (Treasury)
Quality of Advice Review – Proposals Paper
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A Proposals Paper, for consultation, as a part of the Quality of Advice Review, was issued on 29 August 2022. Among other proposals, Review Lead, Michelle Levy proposed:
- that the current ‘Best Interests’ and other financial advice duties were to be consolidated into the provision of ‘good advice’,
- that a number of consumer protections were to be removed and
- that annual fees disclosures for ongoing financial advice would no longer be required.
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The Consultation Paper – Proposals for Reform was issued on 29 August 2022, for comments and further submissions. This Consultation will close on 23 September 2022.
As 23 September 2022 was a Public Holiday in Victoria, AIST was permitted to provide a submission for this consultation on 26 September 2022.
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Review (Treasury)
Quality of Advice Review – Conflicted Remuneration Paper
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This Conflicted Remuneration Paper provides a high-level snapshot of the key findings from the data collected by the Review on general insurance and life insurance and puts forward a series of proposals for reform.
This paper is for information only and there is no invitation for consultation or feedback re these proposals.
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Discussion paper (APRA)
Strategic planning and member outcomes: Proposed enhancements
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Recognising that SPS 515 is relatively new and RSE licensee practices continue to mature, APRA is now seeking to move beyond the ‘documentation-focus’ of the implementation period – where supervisory engagement focused on the business plan, the member outcomes assessment and the business performance review, to one where member outcomes considerations are embedded and integrated across an RSE licensee’s business operations.
Recent benchmarking of RSE licensee implementation of SPS 515 has made clear there remain opportunities for improvement and enhancement. This discussion paper reflects APRA’s view on how SPS 515 and associated guidance must evolve and seeks input from the superannuation industry in pursuit of the common goal of delivering better outcomes to all members.
In undertaking this review of SPS 515, APRA’s approach is informed by plans to modernise the prudential architecture to deliver a simplified and more cohesive framework that provides RSE licensees clarity on their obligations and flexibility to meet them. APRA’s objective is that the superannuation prudential framework, anchored by revised SPS 515, will be more integrated, have a greater focus on outcomes and be easier to understand and navigate. This discussion paper also describes how connected reforms will be pursued consistent with this objective of a simple and forward-looking framework.
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Consultation opened on 1 August 2022 and will close on 11 November 2022.
Information provided in response to this paper will inform revisions to SPS 515 and associated guidance, with consultation on the draft standard and guidance expected to commence in 2023.
AIST will make a submission in relation to this discussion paper.
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Consultation (Attorney-General)
Review of Australia’s Modern Slavery Act 2018
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The Australian Government is undertaking a statutory review of the Act’s operation and compliance over the first three years since commencement.
The A-G’s office is interested to know whether additional measures are necessary to improve the Act’s operation and compliance in the Australian context.
The review commenced on 31 March 2022 and is to be completed within one year, followed by a report to be tabled in Parliament. Professor John McMillan, AO, is leading the review, supported by the Attorney-General’s Department.
The reporting obligations of the Modern Slavery Act apply to entities, including superannuation entities, with a consolidated annual revenue of at least AU$100 million over its twelve month reporting period.
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Consultation closes 22 November 2022 (and opened 22 August 2022).
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Consultation (APRA)
Strengthening Crisis Preparedness
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On 6 September 2022, APRA released for consultation draft guidance on financial contingency and resolution planning. The objectives of the guidance re: the proposed new prudential standards: CPS 190 Financial Contingency Planning and CPS 900 Resolution Planning are set out below:
- CPG 190 is intended to assist entities in meeting the key requirements of the proposed new prudential standard. It provides further explanation of the outcomes that APRA expects, so that entities can meet these expectations through their actions. It is principles-based, rather than prescriptive, and includes examples of better practice.
- CPG 900 sets out a framework for how APRA expects to engage with entities in developing and implementing a resolution plan. The proposed draft guidance explains what is expected of entities in the resolution planning process and sets out the factors that APRA will have regard to in developing resolution plans for individual entities.
- The detailed Consultation description is linked here.
- The 6 September APRA letter to Trustees is linked here.
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Consultation will close 6 December 2022 (and opened 6 September 2022).
AIST made a submission re the first ‘round’ of consultation on 10 May 2022.
APRA is planning to finalise CPS 190 later this year and CPS 900 in the first half of 2023.
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Review Consultation (Treasury)
ASIC Industry Funding Model Review
The Review is being led by Treasury, in consultation with ASIC, the Department of Finance (Finance)
and the Department of the Prime Minister and Cabinet (PM&C).
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On 8 August 2022, the Government announced a review of the Australian Securities and Investments Commission (ASIC) Industry Funding Model (IFM) and issued a Terms of Reference to guide the Review.
The Government has released a Discussion Paper to seek stakeholder views on options, examples of potential changes and questions that are designed to examine and address a range of issues set out in the Review’s Terms of Reference.
Stakeholder feedback received through this process will inform the Review’s consideration, including to consider whether any refinements are required to the IFM to ensure its settings remain appropriate.
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Consultation will close 28 October 2022 (and opened 28 September 2022).
The AIST Policy Committee has confirmed that a submission is to be made.
AIST’s submission was made on 27 October 2022.
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Australian Law Reform Commission (ALRC) - Financial Services Legislation: Interim Report B (ALRC Report 139)
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The ALRC is seeking written submissions from stakeholders.
Submissions, together with further consultations, surveys, workshops, and seminars, will form part of the evidence-base for a further Interim Report (Interim Report C) and the Final Report.
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Submissions close 30 November 2022.
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Consultation (Treasury)
Superannuation Auditor Registration Imposition Regulations 2022
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The Government is consulting on the Superannuation Auditor Registration Imposition Regulations 2022 (the Regulations) which remake and improve the operation of the Superannuation Auditor Registration Imposition Regulations 2012 (2012 Regulations).
The 2012 Regulations are due to ‘sunset’ on 1 April 2023.
The Regulations remake and improve the 2012 Regulations by updating the amounts of the fees and updating the language about the method of indexation. These changes do not affect the substantive meaning or operation of the provisions but allow for greater ease of understanding. The 2022 Regulations broadly follow the structure and numbering of the 2012 Regulations.
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Consultation closes 20 November 2022 (and opened 13 October 2022).
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Consultation (Treasury)
Measuring what matters
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The Treasury invites views on Budget Statement #4: Measuring What Matters and the adoption and development of a Measuring What Matters Statement in 2023.
The Budget Statement’s goal is:
In 2023, the Government will release a new stand-alone Measuring What Matters Statement tailored to Australia. Treasury will continue to research and consult experts and other stakeholders on what the Statement should measure, how the Statement should link to other frameworks and goals – including at the state and territory level – and how the Statement should be communicated.
The 2023 Measuring What Matters Statement will be an important next step in facilitating a more informed and inclusive policy dialogue on how to improve the quality of life of all Australians. Treasury looks forward to working with stakeholders and experts on this important project.
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Consultation closes 31 January 2023 (and opened 25 October 2022).
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Enquiry (PJC, Corporations and Financial Services)
Inquiry into ASIC's capacity and capability to respond to reports of alleged misconduct
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The Parliamentary Joint Committee on Corporations and Financial Services has commenced an inquiry into the capacity and capability of the Australian Securities and Investments Commission (ASIC) to undertake proportionate investigation and enforcement action arising from reports of alleged misconduct.
An Enquiry, which appears to be identical but for one additional item in the Terms of Reference of the PJC Enquiry, is also being conducted by the Senate Economics References Committee, Senator Bragg (the Chair of this Committee) having garnered the votes to conduct an enquiry.
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On 27 October 2022, the Committee began an inquiry into ASIC’s capacity and capability to respond to reports of alleged misconduct.
The committee currently intends to table a report in both Houses of the Parliament by the last sitting day in June 2024.
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Consultation (FRAA)
Effectiveness and capability review of the Australian Prudential Regulation Authority
the Consultation Paper itself.
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The first Financial Regulator Assessment Authority (FRAA) review on the effectiveness and capability of APRA is a targeted assessment of its supervision and resolution functions, focusing on superannuation.
The scope of the review excludes matters that are under consideration in other reviews or consultations, such as the review of the Your Future, Your Super laws.
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Consultation closes 15 December 2022 (and opened 3 November 2022).
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Consultation (AUSTRAC)
Consultation on guidance on enhanced customer due diligence and employee due diligence and training
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AUSTRAC has released for consultation two draft updated guidance products – one on enhanced customer due diligence and the other on employee due diligence and training.
The Proposed updated guidance on Employee due diligence and Employee AML/CTF risk awareness training, discusses when and how a reporting entity should screen employees to make sure they do not pose a money laundering or terrorism financing (ML/TF) risk to the business.
The Proposed updated guidance on Enhanced customer due diligence (ECDD) program provides further insights into reporting entities ECDD program including outlining the relevant procedures, policies, systems and controls (including the role of senior management), to be applied in situations when ECDD, or customer identification and verification obligations, can and cannot be successfully conducted.
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Consultation closes 15 December 2022 (and opened 3 November 2022).
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Consultation (Treasury)
Multinational tax integrity: Public Beneficial Ownership Register
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The Government is seeking comments on the design features for the first phase of a publicly available beneficial ownership register. The Government committed to introducing the register as part of its multinational tax integrity package.
AIST will conduct an analysis of the Consultation material to determine if any of these proposals might have an effect on superannuation funds’ operations or reporting.
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Consultation closes 16 December 2022 (and opened 7 November 2022).
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Consultation (APRA)
Superannuation Data Transformation Project Minor Amendments
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APRA has today commenced consultation on minor amendments to reporting standards introduced under Phase 1 of the Superannuation Data Transformation (SDT) project. These amendments clarify investment option reporting and expenses reporting; reduce frequency of reporting for some requirements; and increase the time for submission of data for some requirements.
The proposed amendments are described on Page 5 of the Discussion Paper. Drafts of the amended Reporting Standards are available on the Consultation Homepage.
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Consultation closes 2 December 2022 (and opened 7 November 2022).
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