The SMSF Association (SMFSA) has expressed its disappointment over the lack of neutrality with the proposed non-arm’s-length expenditure (NALE) measures, with retail and public offer superannuation funds to be excluded from the legislation if it is implemented.
SMSFA head of advocacy and policy Tracey Scotchbrook said the industry body had made several attempts to raise issues of concern with the Treasury Laws Amendment (Support for Small Business and Charities and Other Measures) Bill 2023, however, it appeared those calls for reform had gone unheard.
“Unfortunately, we’ve been unsuccessful, despite strong representations that have been made to Treasury on this through the various different consultation phases [and also] at the Senate inquiry, which [SMSFA chief executive] Peter Burgess attended alongside our colleagues to give evidence in Canberra in response to our submission to the committee inquiry,” Scotchbrook told attendees of a recent SMSFA webinar.
She singled out the perceived unfairness of the measure as Australian Prudential Regulation Authority (APRA)-regulated superannuation funds will be exempt from it.
“It was disappointing to see the Association of Superannuation Funds of Australia and the other large APRA funds cited as showing their support for these measures and the need for inclusion,” she said.
“We don’t have a neutral piece of policy or legislation here, with those funds being carved out from the general expense measures to do with NALE. The lack of neutrality around this, whilst it was noted in the Senate inquiry report, [has] not been addressed and the bill seems to be progressing as written.
“There is so much complexity and so many issues that remain unresolved. And our concern is that government and Treasury believe that because of this two-times approach for general expenses that NALE has been fixed and put to bed.
“But really, that is one small slice of the problems that still remain around the non-arm’s-length [arrangements]. We will continue to strongly advocate to try and get a workable solution in this space.”