Commonwealth Numbered Regulations - Explanatory Statements

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SUPERANNUATION (FINANCIAL ASSISTANCE FUNDING) LEVY AND COLLECTION AMENDMENT REGULATION 2013 (NO. 1) (SLI NO 29 OF 2013)

EXPLANATORY STATEMENT

Select Legislative Instrument 2013 No. 29

Issued by authority of the Minister for Financial Services and Superannuation

Superannuation (Financial Assistance Funding) Levy Act 1993
Financial Institutions Supervisory Levies Collection Act 1998

Superannuation (Financial Assistance Funding) Levy and Collection Amendment Regulation 2013 (No. 1)

Section 10 of the Superannuation (Financial Assistance Funding) Levy Act 1993 (the Levy Act) and section 29 of the Financial Institutions Supervisory Levies Collection Act 1998 (the Levies Collection Act) provide that the Governor-General may make regulations to recoup the amount of grants of financial assistance to superannuation funds that have suffered loss as a result of fraudulent conduct or theft made under Part 23 of the Superannuation Industry (Supervision) Act 1993 (SIS Act). 

Specifically, the Levy Act provides for the imposition of levies on regulated superannuation funds and approved deposit funds.  The Levies Collection Act provides for the collection of levies imposed under the Levy Act and certain other Acts.

In the 2012-13 financial year, the Minister for Financial Services and Superannuation made one determination to grant financial assistance of $16,719,935 under Part 23 of the SIS Act.  In addition there is an amount of $2,191,934.42 which is the balance of a grant of financial assistance announced on 13 April 2011 (the 2011 grant) which remains to be recouped by the Commonwealth.

The purpose of the amending Regulation is to impose a levy on regulated superannuation funds and approved deposit funds, other than self managed superannuation funds and levy exempt funds, to recoup the amount of financial assistance granted under Part 23 of the SIS Act in the 2012-13 financial year and to collect the balance that remains to be recouped by the Commonwealth for the 2011 grant.

Section 6 of the Levy Act provides that the regulations may impose a levy or levies on each fund other than those to which grants under Part 23 of the SIS Act were made.   The regulations may specify a maximum and/or a minimum amount of levy.    

Section 7 of the Levy Act provides that the rate, minimum amount and maximum amount of a levy or levies are to be fixed on the basis that the amount of revenue to be raised is not to exceed the amount needed for the Commonwealth to recoup the amount of that financial assistance.  Also, under section 7 the total amount of the levy (and other such levies) imposed under the Levy Act in one financial year should not exceed 0.05 per cent of the sum of the values (at the end of the previous financial year) of all the assets of the funds on which the levy (or levies) are imposed. 

Section 8 of the Levy Act specifies the formula to be used in working out the amount of a levy imposed on a fund.  The applicable rate must not exceed 0.0005.

The Regulation sets an applicable rate of 0.00002497 and a maximum and minimum levy amount of $750,000 and $50, respectively.  The applicable rate, maximum and minimum levy amounts have been fixed so that the amount of revenue that is raised would not exceed the amount needed for the Commonwealth to recoup the $16,719,935 amount of assistance granted in the 2012-13 financial year and the balance of $2,191,934.42 that remains to be recouped for the 2011 grant.

Section 19 of the Levies Collection Act provides that a levy payable by a fund is due on a date specified in the regulations and that the date must not be earlier than the 28th day after the day on which those regulations took effect.  The Regulation provided for the levy to be due and payable a minimum of 28 days after registration.

In order to allow funds sufficient time and advanced notification of the levy payable by each fund, the Australian Prudential Regulation Authority will provide funds with 60 days from the date of the invoice to pay the levy.

Public consultation on the Regulations was undertaken between 25 January 2013 and 8 February 2013.  One submission supporting the regulations was received.

The Regulation commenced the day after it was registered on the Federal Register of Legislative Instruments.

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Superannuation (Financial Assistance Funding) Levy and Collection Amendment Regulation 2013 (No. 1)

This Regulation is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview

Section 10 of the Superannuation (Financial Assistance Funding) Levy Act 1993 and section 29 of the Financial Institutions Supervisory Levies Collection Act 1998 provide that the Governor-General may make regulations to recoup the amount of grants of financial assistance to superannuation funds that have suffered loss as a result of fraudulent conduct or theft made under Part 23 of the Superannuation Industry (Supervision) Act 1993 (SIS Act). 

In the 2012-13 financial year, the Minister for Financial Services and Superannuation made one determination to grant financial assistance of $16,719,935 under Part 23 of the SIS Act.  In addition there was an amount of $2,191,934.42 which was the balance of a grant of financial assistance announced on 13 April 2011 (the 2011 grant) which remains to be recouped by the Commonwealth.

The purpose of the Regulation is to impose a levy on regulated superannuation funds and approved deposit funds, other than self managed superannuation funds and levy exempt funds, to recoup the amount of financial assistance granted under Part 23 of the SIS Act in the 2012-13 financial year and to collect the balance that remains to be recouped by the Commonwealth for the 2011 grant.

Human rights implications

The Regulation does not engage any of the applicable rights or freedoms.

Conclusion

The Regulation is compatible with human rights as it does not raise any human rights issues.

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