The penalty regime for unpaid super has again been proven to be wanting, with the Senate Estimates Committee hearing yesterday that as many as 8 out of 10 employers have got away with failing to pay super on time.
Under questioning from deputy chair of the Senate Economic Committee, Senator Chris Ketter, the Australian Taxation Office (ATO) confirmed that it routinely waived all penalties for late payment of super and had not levied a single 200 per cent maximum penalty in the last five years.
The ATO also admitted that it had inappropriately waived a nominal $20 per employee administrative fee penalty up until 2017.
Industry Super Australia (ISA) this morning called for an “urgent overhaul” of the penalty regime for unpaid super in light of this testimony, saying the current approach undercut the majority of employers who were doing the right thing.
“The wholesale waiver of statutory penalties prescribed under the law for failing to pay super on time is a green light to unscrupulous employers short-changing their workers’ super,” ISA deputy chief executive, Matt Linden, said.
“The ATO’s so called ‘practical compliance approach’ is causing a textbook moral hazard where employers take the risk knowing they won’t be caught or even if they are simply pay what they should have paid anyway (with nominal interest) and walk away.”
The organisation called for minimum mandatory penalties, slamming the $20 administrative penalty as “wholly inadequate and not even a parking ticket penalty”.
Linden predicted that should weak penalty enforcement continue, “the $6 billion a year problem will continue to spin out of control”.
BlackRock boss Larry Fink praised Australia’s superannuation system in his annual chairman’s letter.
The prudential regulator has announced it will publish new expenditure data of superannuation funds, providing details on expenses like advice, director remuneration, and payments to unions.
Affirming the UK’s growing attractiveness as an investment destination, a number of Australia’s largest investors recently joined the UK Foreign Secretary for an exclusive briefing in Canberra to discuss further opportunities for trade and growth.
The specialist superannuation law advisory practice is set to wind up, with managing partner Jonathan Steffanoni planning to bring a new offering to market.
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