Treasury released its response paper to the April 2013 Financial Industry Supervisory Levy Methodology Review yesterday.
Among its conclusions, Treasury said there “is a need to clarify” when the levies are being used to recover costs and when they are not.
Treasury also concluded there should be increased transparency of how the costs of an activity are recovered through the levies process.
“The lower supervisory activity required for prudentially regulating pooled superannuation trusts (PSTs) could be recognised through lower levy rates compared to other superannuation entities,” said Treasury.
Speaking to InvestorDaily, ASFA chief executive Pauline Vamos said Treasury had responded to the April 2013 paper broadly in lines with the ASFA submission.
But one of the big things that “needs to be looked at” is the levy-making powers available to Treasury, said Ms Vamos.
“There is no law that allows you to levy SMSFs. But the SuperStream levy only applies to pooled vehicles,” she said.
However, the SuperStream regime is a transaction system for the whole industry, including self-managed funds, said Ms Vamos.
The current regulatory, levying and prudential arrangements do not recognise there are now two major superannuation structures (APRA-regulated and self-managed) and as a result “things have to be adjusted”, she said.
Ms Vamos was scathing when it came to transparency on the part of the regulatory bodies about the manner in which the levy is collected.
“As for transparency, it’s been non-existent – and it’s still non-existent. Whether you’re talking about APRA, ASIC or the ATO it’s not transparent. And it’s very concerning,” she said.
“We still haven’t got full transparency on how the $400-odd million was spent on SuperStream, and we get no real transparency from ASIC,” said Ms Vamos.
There has been no transparency on the $25 million charged to pooled vehicles that has gone to ASIC, and there is little transparency from APRA when it comes to levies either, she said.
“Is the pooled money being paid for supervision of other sectors?” she asked.
“For example, I know ASIC has been taking steps around some SMSF issues in terms of some of the property spruikers and things like that – who’s paying for that?” asked Ms Vamos.
“No levies are applied to financial planners, no levies are applied to fund managers, but they’re applied to superannuation funds,” she said.
The question is whether SMSFs should pay a levy too, or whether there is “another way”, she said.
“It’s about that transparency – fund members pay a lot of money for supervision. It’s really important we know how it’s being applied,” said Ms Vamos.
“I think they’ve got to re-look at who pays supervisory levies,” she said.
