Legislation closes the super corporate box

The Federal Government believes it has closed the door to the superannuation fund corporate hospitality box with the passage through the Senate of key legislation last week.

According to Treasurer, Josh Frydenberg the passage of the Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 1) Bill represented the effective implementation of a key recommendation of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.

In doing so, Frydenberg specifically referenced the Royal Commission’s Recommendation 3.6 that trustees be prohibited from “treating” employers in return for “having the recipient nominate the fund as a default fund for having one or more employees of the recipient apply or agree to become members of the fund”.

The Treasurer said the legislation would also see directors of superannuation funds face criminal penalties for breach of their best interests duty and provide the Australian Prudential Regulation Authority (APRA) with more powers to deal with underperforming superannuation funds.