The industry must prepare for unintended consequences that will emerge from the complexity of the new superannuation legislation, particularly as the definition of super has not yet been enshrined.
“It’s been a hell of a year from a super regulation standpoint,” Self-managed Independent Superannuation Funds Association (SISFA) director, government and stakeholder relations Michael Lorimer said at the 8th Annual SISFA SMSF Forum in Melbourne.
“And clearly there’s a lot more to play out once we actually know what we’re dealing with, and what that’s going to look like from an implementation perspective particularly for SMSFs, and super more broadly.
“There’s so much more to be done, and there always will be. It will be about getting on with the job.”
Lorimer called out the government for its hasty consultation and submissions process for the draft super laws and highlighted the significant complexity of the new rules, which the industry was still getting to grips with.
“Between the legislation itself and the explanatory material, it exceeded 500 pages, yet apparently one of the objectives as drafted for the superannuation system is about simplicity,” he said.
“The whole purpose of enshrining the purpose of superannuation into legislation was to ensure that any subsequent laws that are introduced were being dealt with or being considered in that context.
“So it seems bizarre that we’re dealing with hundreds of pages of fundamental changes to superannuation but we still haven’t seen what the objective is.”
SISFA managing director Mike Goodall added that the new laws would not just impact the 4 per cent of individuals with super that the government continues to maintain.
“I fear there are still many things that need to be worked out and I think the consequences are yet to be fully understood from the legislation,” Goodall said.
“In one of the tranches, there was about 24 new concepts were introduced into superannuation and I think that creates and poses risks for our segment, and not just in superannuation but if you think about the changes, many of them introduce the risk of non-compliance as people inadvertently come to grips with all the requirements.
“And certainly the large industry funds have SMSF divisions these days, so they will be impacted as well.”
Two of the federal government’s three super bills were passed by the House of Representative and the Senate unamended on 23 November.
Meanwhile, the Superannuation (Objective) Bill, which will enshrine the objective of super in legislation, is being considered by the Senate Economics Legislation Committee, which is due to report back on 14 February 2017.