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Centrelink or some other third party should be empowered to help self-managed superannuation funds (SMSFs) deal with hardship claims, according to the Association of Superannuation Funds of Australia (ASFA).
In a submission responding to the Cooper Review, ASFA said that hardship claims that allowed trustees to release moneys in instances where members were suffering financial hardship were problematic within SMSFs, because the trustees were often making decisions about themselves.
It said it believed that any early release request from an SMSF on the grounds of financial hardship needed to be considered by an independent third party and, subject to appropriate consultation, it believed Centrelink could be made the approving authority.
Elsewhere in its submission, ASFA said SMSFs, along with other major superannuation funds, should have the ability to invest in collectibles and ‘personal use’ assets — something which counters the position adopted by the Cooper Review.
The ASFA submission said that a statistical analysis published by the Cooper Review itself had revealed that the total value of such assets as artworks, collectibles, metals and jewels represented just 0.1 per cent of all SMSF assets and that the practical reality was that very few SMSFs held such investments.
The submission said that ASFA would prefer to see all super funds, including SMSFs, being able to invest in assets that the trustee believed to be appropriate to the provision of retirement benefits.
It said that if the Cooper Review Panel wished to ban collectibles in SMSFs, a grandfathering provision could also be made available to those SMSFs that had invested in collectibles allowing them to continue, but not increase, their current investment in such assets.
