Govt to drag super firms into electronic age

Govt to drag super firms into electronic age

Summary: The government has broadly supported "SuperStream" recommendations to improve the processing of superannuation funds made by the Cooper Review.

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The government has broadly supported "SuperStream" recommendations to improve the processing of superannuation funds made by the Cooper Review.

The Cooper Review said that the current super administrative processes involved high costs because of manual processing of money transfers and data, which was often poor and incomplete.

It suggested that: the quality of data in the system as well as the way consolidation and contributions of funds be improved, tax file numbers be used as an identifier to help find lost funds, and the use of technology be increased to improve processing efficiency.

The government supported the "broad direction" of the recommendations, saying that it would early next year set up a SuperStream consultative sub-group, including employers and consumers, to consider the implementation of the recommendations and what datasets should be provided for superannuation contributions, rollovers between funds and benefit payments. The group would also design a process to follow when data is absent.

The Australian Taxation Office (ATO) will also have a role to play in implementing the recommendations.

The government said it would consider whether to mandate common data standards for electronic transactions after a transactional period. Standardised formats will aim to encourage the use of electronic transmission for data transfers.

The government will face costs to implement the tax file number as an identifier for super funds. It would also have to invest in updating systems and forms. To pay for these costs, it will impose a temporary industry levy on funds regulated by the Australian Prudential Regulatory Authority.

The tax file number (TFN) will become the primary identifier for member accounts from 1 July next year. Some of the restrictions around how a superannuation fund can use a TFN will be removed in order to enable the number's use to consolidate accounts.

The industry is expected to incur costs in its move to common data standards and electronic processing, but Ernst & Young has estimated that SuperStream recommendations could save the industry up to $1 billion per year.

Most of the recommendations are scheduled to be in place by 1 July 2015, but the government hoped to have common data standards and from that the electronic transmission of data by 1 July 2012.

Topics: Government, Government AU

Suzanne Tindal

About Suzanne Tindal

Suzanne Tindal cut her teeth at ZDNet.com.au as the site's telecommunications reporter, a role that saw her break some of the biggest stories associated with the National Broadband Network process. She then turned her attention to all matters in government and corporate ICT circles. Now she's taking on the whole gamut as news editor for the site.

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  • As someone who prepares 12 or more super returns - on behalf of 2 companies each month, I think I have a good understanding of what is wrong with the current super system. Some super funds make companies jump through a series of hoops before they even allow them to contribute to the fund on behalf of the employee.
    The real problem is that super cjhoice was poorly thought out and even worsely implemented.
    Super funds have watched as the number of contributors have probably doubled - without an increase in members! An adnmionistrative nightmare.
    As for using tfns to identify super fund accounts - there si a problem - that would mean that the super fund would be including the tfn on every written piece of correspondence to their members - a recipe for disaster!
    I prepare one electronic return - in a format given to me by the super fund. i use this method because it is the easiest way to manage super for 50 member payments.
    Some super funds do not even have contribution forms !
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