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Consultation (Treasury)
Superannuation Performance Test Treatment of Faith-based Products
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The Government is seeking stakeholder views on exposure draft legislation to adjust how faith‑based superannuation products are treated under the annual performance test.
The legislation seeks to:
- require trustees to apply to APRA for faith‑based product status
- subject faith‑based products to a supplementary test that considers their faith‑based investment strategy, if they fail the original test
- exempt faith‑based products from the consequences of failure if they pass the supplementary test.
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Consultation will be open until 16 August 2022
Both the Exposure Draft Legislation and Explanatory Memorandum are available on the Consultation page.
Consultation is now closed.
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Consultation (Treasury)
Payment times reporting: updated guidance material
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The scheme requires entities with a total annual income of over $100 million to report on the payment terms and times for their small business suppliers. This captures many super fund trustees.
Treasury is inviting feedback on 3 draft guidance notes for the Payment Times Reporting Scheme.
The updated guidance is intended to assist reporting entities to meet their obligations and understand Treasury’s expectations when undertaking compliance activities. The need for updated guidance was identified after reviewing enquiries and reports from the first year of operation of the scheme.
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Consultation submissions may be made up until 2 September 2022.
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Consultation (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.
The Consultation period closed on 3 June 2022.
134 submissions were received for this consultation, including 17 confidential submissions.
The (non-confidential) submissions made are on the QAR website.
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Consultation (Treasury) & (Board of Taxation)
Crypto asset secondary service providers: Licensing and custody requirements &
Review of the Tax Treatment of Digital Assets and Transactions in Australia
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The previous government announced consultations and inquiries for digital transactions and crypto assets.
On 21 March, the then-Treasurer, Josh Frydenberg, and then-Minister for Superannuation, Financial Services and the Digital Economy, Jane Hume, jointly announced that:
- Government has released a paper seeking industry’s feedback by the end of May on proposed new crypto asset licensing and custody requirements, and covering the first stage of a broader token mapping exercise to be completed by the end of 2022;
- Government has released the terms of reference for a review by the Board of Taxation into the appropriate policy framework for the taxation of digital transactions and assets such as crypto (which is being conducted on the basis it will not increase the overall tax burden). The Board has been asked to complete its review by 31 December; and
- the Government will release terms of reference covering its request for advice from the Council of Financial Regulators (CFR) on potential policy responses to address the issue of de-banking for financial technology firms, digital currency exchanges, and remittance providers. The CFR has been asked to provide advice to the Government by the end of June 2022.
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Consultation was opened on 21 March and closes on 27 May 2022.
Treasury Consultation has now closed.
The Board of Taxation Terms of Reference were also released on 21 March with a view to “report back to the Government by the end of 2022”
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Consultation (APRA)
Review of the amendments to the Superannuation Guarantee (Administration) Act 1992
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APRA has released a letter to registrable superannuation entity (RSE) licensees of Defined Benefit funds to seek their input on the amendments to the Superannuation Guarantee (Administration) Act 1992 (SGAA), commenced in September 2020.
The letter requests feedback regarding the amendments to the Choice of Fund requirements – and in particular, any unintended consequences for Defined Benefit arrangements.
Trustees may recall that the Treasury Laws Amendment (Your Superannuation, Your Choice) Act 2020 made amendments to the SG (Administration) Act 1992 (Schedule 1) and also described, in Section 4, that the legislated provisions are to be reviewed within 30 months - particularly in relation to any unintended consequences of the amendments in relation to DB Schemes.
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This consultation will be open for submissions until 8 September 2022.
An AIST Special Interest Group convened on 21 July 2022 to discuss this issue.
AIST will NOT be preparing a submission for this Consultation.
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Consultations (APRA)
APRA strengthens transparency on remuneration and bank disclosures
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The cross-industry Prudential Standard CPS 511 was introduced last year to strengthen remuneration practices across the banking, insurance and superannuation industries. The implementation of CPS 511 is due in 2023 for large entities and 2024 for smaller entities.
APRA is consulting on disclosure and reporting proposals to support the implementation of CPS 511 which, once implemented, will provide greater transparency on remuneration practices across all APRA-regulated entities.
The Consultation relates principally to the disclosure and reporting obligations described in the Discussion Paper.
This Consultation further relates to APRA’s proposed changes to CPS 511 and the proposed Reporting Standard CRS 511 Remuneration and the Reporting template CRS 511.0.
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Submissions are requested by APRA by 7 October 2022.
Following review of industry feedback, APRA plans to finalise the requirements by the end of 2022.
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Consultation (APRA)
Proposed prudential standard designed to strengthen the management of operational risk
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APRA has released for consultation a new prudential standard designed to strengthen the management of operational risk in the banking, insurance and superannuation industries.
APRA proposes to introduce a new cross-industry Prudential Standard CPS 230 Operational Risk Management (CPS 230) which will set out minimum standards for managing operational risk, including updated requirements for business continuity and service provider management.
The proposed Prudential Standard CPS 230 Operational Risk Management (CPS 230) is attached to the Consultation materials.
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Consultation opened 28 July. Submissions will be accepted until 21 October 2022.
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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 (Treasury)
Review of the Australian Securities and Investments Commission Industry Funding Model
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The Australian Securities and Investments Commission (ASIC) Industry Funding Model (IFM) commenced in July 2017, following a recommendation of the Financial System Inquiry that the Government introduce a cost recovery model for ASIC.
The Government has commenced a review of the Australian Securities and Investments Commission (ASIC) Industry Funding Model (IFM) and has issued a Terms of Reference to guide the Review. The Review will be forward-looking and focused on identifying refinements to the IFM that may be required to ensure its settings remain appropriate.
The Review will be led by Treasury in consultation with ASIC, the Department of Finance and the Department of the Prime Minister and Cabinet.
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This Review will be ongoing however Treasury will undertake a public consultation process later in the year which will provide an opportunity for stakeholders to provide input into the Review.
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Consultation (Treasury)
Rationalisation of Ending ASIC Instrument Measures
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The Government has released exposure draft legislation to move matters in legislative instruments made by the Australian Securities and Investments Commission (ASIC) into the primary law and regulations. This will provide greater certainty making it easier for stakeholders to identify their rights and obligations under the financial services law.
The draft legislation forms part of the Treasury Law Improvement Program, which supports the regulatory stewardship of Treasury portfolio legislation, and also includes Treasury’s regular minor and technical amendments process. The Government intends to pursue regular improvement and maintenance opportunities under this Program to ensure that Treasury laws remain current, fit‑for‑purpose and transparent.
Amendments relating to the Australian Law Reform Commission’s Interim Report A are also being consulted on, and are available on the Treasury website.
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Consultation ends on 20 September (and commenced on 24 August 2022)
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Consultation (Treasury)
Improving Corporations and Financial Services Law
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The Government has released exposure draft legislation to reduce the complexity of Australia’s corporations and financial services laws by making these laws more adaptive, efficient and navigable within existing policy settings. Simplifying these laws will benefit industry and consumers and is critical to maintaining a strong financial sector.
The draft legislation implements formal recommendations and informal suggestions made by the Australian Law Reform Commission (ALRC) in Interim Report A of its Review of the Legislative Framework for Corporations and Financial Services Regulations (‘ALRC Financial Services Interim Report’).
Amendments to move matters in current legislative instruments made by the Australian Securities and Investments Commission (ASIC) into the primary law and regulations are also being consulted on and are available on the Treasury website.
The draft legislation forms part of the Treasury Law Improvement Program, which supports the regulatory stewardship of Treasury portfolio legislation and also includes Treasury's regular minor and technical amendments process. The Government intends to pursue regular improvement and maintenance opportunities under this Program to ensure that Treasury laws remain current and fit‑for‑purpose, including consideration of other ALRC recommendations and additional ASIC instruments.
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Consultation ends on 20 September (and commenced on 24 August 2022)
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Consultation (Treasury)
Financial adviser professional standards
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This consultation is further described in the main body of the AIST Policy News.
The Government made an election commitment to remove the tertiary education requirements for financial advisers who have passed the exam, have 10 years’ experience in Australia and have a clean disciplinary record of financial practice.
The Government has released a consultation paper to seek industry’s views on how to best implement this commitment.
The consultation paper also seeks feedback on how education standards for new entrants could be improved, allowing financial advice to continue to develop into a career of choice. The paper proposes options to streamline the core knowledge areas for degrees, and to simplify the degree approval process and professional year.
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Consultation ends on 16 September (and commenced on 23 August 2022)
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