The Australian Institute of Superannuation Trustees (AIST) has welcomed an announcement from the Opposition that it will move to amend key measures in the insurance in superannuation package now before Parliament.
AIST chief executive officer Eva Scheerlinck said the Opposition’s decision to move amendments allowing super funds or cohorts of members with a demonstrated need for insurance to be provided with opt-out insurance was a much-needed measure to ensure workers who needed insurance did not have it cut off.
Scheerlinck also welcomed the Opposition’s proposal to ensure mothers on maternity leave did not have their super swept up in the definition of inactive account.
“AIST and its member funds have repeatedly called for amendments to the package to protect these members. We are pleased the Opposition has listened,” Scheerlinck said.
Similarly, a third proposal to speed up consolidation so that super is returned to members and does not languish with the Australian Taxation Office also benefited members, she said.
The Opposition’s announcement of amendments to the Bill followed an earlier announcement from Assistant Treasurer Stuart Robert that the Government would seek an amendment to allow super funds to provide opt-out insurance to young members in high-risk occupations.
Scheerlinck said the Government’s announcement was welcome but did not go far enough to address other industry concerns.
She said the AIST continues to call on all political parties and Senate members to support an extension to the implementation period for the overall package of insurance in super reforms.
Scheerlinck said the implementation deadline would require every super fund to renegotiate their default insurance contracts in less than seven months from now, leading to potential industry disruption and poorer outcomes for members.
“The implementation period for insurance is way too short. It won’t give funds time to get a better deal for their members in the marketplace – it’s going to push up premiums,” she said.