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Thursday, 27 November 2008
Page: 7641

Senator SHERRY (Minister for Superannuation and Corporate Law) (10:28 PM) —I table a supplementary explanatory memorandum, circulated in the chamber on 26 November, relating to the two government amendments to this bill and seek leave to move the amendments together.

Leave granted.

Senator SHERRY —I move government amendments (2) to (8) on sheet RG296:

(2)    Schedule 1, item 16, page 6 (lines 27 and 28), omit “, by the next date set for the purpose by the Commissioner”.

(3)    Schedule 1, item 16, page 7 (line 2), after “interest”, insert “by the next date set for the purpose by the Commissioner”.

(4)    Schedule 1, item 16, page 10 (line 13), omit “by scheduled statement day”.

 (5)   Schedule 1, item 16, page 10 (line 23), omit “day.”, substitute “day; or”.

(6)    Schedule 1, item 16, page 10 (after line 23), at the end of subsection 20F(1), add:

              (c)    if a day is identified for the superannuation provider under the regulations that is later than the day described in paragraph (a) and later than the day described in paragraph (b) if it is relevant—that later day.

(7)    Schedule 1, item 16, page 12 (after line 4), after subsection 20F(4), insert:

Regulations for the purposes of paragraph (1)(c)

      (4A)    Regulations for the purposes of paragraph (1)(c) may provide for a day to be identified by the Commissioner or the Australian Prudential Regulation Authority. This does not limit the provision that the regulations may make for identification of a day for those purposes.

(8)    Schedule 1, item 16, page 15 (after line 31), after subparagraph 20J(6)(a)(i), insert:

                  (ia)    paragraph 20F(1)(c); and

I have already indicated why the government has moved these amendments. The government heard from the Senate economics committee following its hearings that concerns were raised that some superannuation funds potentially may not have sufficient liquidity to meet their payment obligations to the tax office under the bill. Accordingly, to help address some of these concerns in light of the current economic climate, the government has acted swiftly to introduce parliamentary amendments to the bill. The amendments will enable regulations to be made to defer—I emphasise defer—the due dates for payment by superannuation funds in certain prescribed circumstances. For example, the regulations could provide for a short-term deferral of the payment date if APRA considers payment by the due date would have a significant adverse impact on the fund’s financial position.

This is similar to an existing power that APRA has to vary the requirements for funds to transfer superannuation benefits if it would have a significant adverse effect on their financial position. The amendments do not provide a general deferral, but funds will be expected to continue to make the necessary preparation so that payments can be made by the expected due dates. The first payments are expected to be due in April next year. Further funds are also required, under current law, to have adequate investment strategies in place to take into account, amongst other matters, anticipated liquidity requirements. Accordingly, it is expected that the payments will be deferred only in exceptional circumstances. That is an outline of the two government amendments that I moved.