Self-Managed Superannuation Funds (SMSFs) have been confirmed as one of the biggest financial services winners from the Federal Budget, with the industry particularly welcoming the manner in which it appears to have cleared the way for dismantling legacy products.
The significance of the legacy move was recognised by Chartered Accountants Australia and New Zealand (CA ANZ) with its superannuation leader, Tony Negline, welcoming the measure which he said he been buried in the Budget papers.
“We welcome the ability to dismantle some older style legacy pensions that have been barnacles attached to our complicated superannuation system for many years,” Negline said.
“The Government will now permit market-linked, life expectancy and lifetime products to be demolished for a two-year period,” he said. “This will allow a small number of SMSF members to get out of products that outlived their usefulness more than 10 years ago.”
“CA ANZ along with the super industry have long advocated to Government for this solution and they should be congratulated for acting on this ongoing problem.
“We also welcome the relaxing the residency rules for SMSFs when fund members have temporarily moved overseas for work or family reasons. While this is a piecemeal approach to the complicated super problem our nation has, this flexibility is necessary and needed.”
Amid a challenging market environment, three super fund CIOs have warned against ‘jumping at shadows’.
The professional body is calling for the annual performance test to transition to a two-metric test, so it better aligns with the overarching duty of super fund trustees to act in the best financial interests of their members.
AustralianSuper, Rest, and HESTA agree on the need to retain and enhance the test, yet they differ in their perspectives on the specific areas that warrant further refinement.
Australia’s second-largest super fund has confirmed it is expanding its presence in the UK following significant investment in the region.
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