The Association of Superannuation Funds of Australia (ASFA) has called for a comprehensive independent review of the costs associated with implementing a cornerstone of the Government's Stronger Super policy, SuperStream.
In a submission to the Treasury, ASFA expressed concern at the cost of implementing the SuperStream initiative.
"With respect to the specifics of the proposed financial industry levies for 2013-2014, we note with some concern that the funding required with respect to SuperStream ($99.5 million) represents an amount which is approximately 86 per cent of the operating costs for all of [the Australian Prudential Regulation Authority] APRA ($115.6 million)," the ASFA submission said.
"We query how this can possibly be the case."
ASFA questioned how SuperStream costs could be near equivalent to the cost of running APRA.
"APRA is responsible for the prudential supervision of Authorised Deposit Taking Institutions (ADIs), General Insurance, Superannuation and Life Insurance and Friendly Societies. As at 30 June 2011 it employed over 600 Full Time Equivalent (FTE) staff. We query how the SuperStream costs for 2013-14 can be roughly equivalent to the cost of running a department of over 500 FTE.
"When it comes to the costs with respect to the superannuation industry in 2013-14, the costs for APRA are $34.1 million; ATO $7.3 million; ASIC $12.0 million and DHS $4.4 million, totalling $58.7 million. In this context the SuperStream levy represents 1.7 times the total of all of the other costs with respect to superannuation combined," the ASFA submission said.
ASFA said it welcomed Treasury's annual evaluations of SuperStream, but said given the magnitude of the costs of the initiative, an independent and comprehensive review was needed urgently.
