The Australian Institute of Superannuation Trustees says that the legislation by the Government aims at changing the rules and regulations around insurance in the superannuation is too shallow with short time-frames.
Last week, the Government reintroduced the Treasury Laws Amendment (Putting Members’ Interest First) Bill on the floor of the Parliament, a move that is expected to see insurance in the superannuation become opt-in for those with super balances as low as $6,000 or aged 25 years and below.
The legislation will represent a reintroduction of laws previously subjected to amendment in the Senate house before the recent May 18 Federal Election.
The head of advocacy at AIST, Ailsa Goodwin stated that the organisation was intensifying its advocacy given the serious implications the legislation would have.
“We highly support the intent of this government legislation to safeguard the interests of some members including the young people—from paying for insurance services they may otherwise not need. Unfortunately this same legislation is very blunt and its time frame is too short,” she noted.
“Sadly, younger people in occupations considered too risky often get injured and end up making claims. The legislation therefore needs to have exemptions for super funds for these kinds of members in various categories,” Goodwin said.
While supporting concerns raised by the AIST about the Government’s impracticable timelines, Goodwin explained that if the industry fails to provide enough time to deal with all the changes that were happening, eventually its members that would end up suffering.