Super Stream Gathers Momentum

By Author: Vikas Arora
Total Articles: 1
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The SuperStream initiative was introduced by the Federal Government in 2011.
SuperStream is a committee of financial experts appointed by the Government to investigate and make recommendations for improving how the super industry operates.

The main focus of SuperStream is to ‘streamline’ the back office or administration side of the industry. The SuperStream reforms are intended to address existing inefficiencies in back office processing within the super industry. This includes the lack of data transmission requirements within the system. The result is poor data quality and insufficient member information preventing correct allocation and contributions for automated accounts.

The widespread use of manual payments, such as cheques, which slow down the payment, and duplicate and lost accounts are also being looked at by the committee. Some of the proposals made so far include making it compulsory for employers to pay electronically and show super contributions on all employees’ pay slips. In order to help pay for SuperStream, the Government has created a levy for large super funds, which came into ...
... effect on 1 July.

The Australian Institute for "Superannuation" Trustees (AIST) said the revision of the maximum amount provided a better balance between the contributions of smaller and larger funds. The levy is capped at $2 million for super rich funds with five or more members. This is a huge increase from 2011/12, when the maximum was set at $260,000 per large fund. The Self Managed Super Fund (SMSF) industry, the largest super sector may have to contribute $38 million to the levy this year, which would be about $80 per fund.

Smaller APRA managed funds with four members or fewer will not have to contribute any extra under the new ruling. Some industry experts have criticised the size of the super levy, especially in regard to the amount allocated to the implementation of SuperStream. The Government has estimated the amount required to fund SuperStream is $467 million over the next seven years, some super analysts predict the majority of this will come from larger funds.

Although it may vary from year to year, the levy amount for this year will be calculated as 0.02434 per cent of a fund’s assets. Large funds will also have to pay an unrestricted levy of 0.006535 per cent of all listed assets.

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