media release (13-056MR)

ASIC consults on reforms to superannuation forecasts

Published 20 March 2013

ASIC today released a consultation paper proposing reforms to assist superannuation fund trustees in providing retirement estimates.

Consultation Paper 203 Age pension estimates in superannuation forecasts: Updates to RG 229 (CP 203) proposes updates of our original guidance issued in December 2011 (refer: 11-282AD).

CP 203 proposes reforms which:

allow super funds to include the age pension as part of a retirement estimate
clarify that super funds may rely on the prescribed assumptions about contributions and earnings in calculating a member's retirement estimate. We do not expect the super fund to make specific inquiries to determine whether the member’s individual circumstances match the prescribed assumptions
make other minor amendments to improve the operation of the relief.

ASIC Commissioner John Price said the consultation aims to broaden the ability of super funds to use retirement estimates if they wish.

‘Retirement estimates are an important tool to help super fund members engage with their superannuation and think about their retirement planning.

‘With the continued growth of the super sector, it is vital that fund members remain confident and informed about the prospects of their fund. The updated guidance will allow trustees to provide more accurate estimates in this regard,’ Mr Price said.

Superannuation fund trustees providing retirement estimates (which may be personal advice) have been granted class order relief in [CO 11/1227] Relief for providers of retirement estimates from the licensing, conduct and disclosure requirements for general and personal advice in the Corporations Act 2001.

Comments on CP 203 are due by 19 April 2013.

Download:

CP 203 (proposed amendments to RG 229 and CO 11/1227 appear as attachments included with CP 203)

Background

A retirement estimate is a broad estimate of the potential income available to a super fund member at retirement, taking into account their current superannuation account balance, the impact of fees, and assumptions about future contributions, earnings and other matters.