Regulator sets 5-day limit on super release
The prudential regulator has told super funds they must release member funds within five business days in the vast majority of cases if they have been assessed as eligible for the government’s early release scheme.
In a statement, Assistant Minister for Superannuation, Financial Services and Financial Technology Jane Hume said the government welcomed the announcement by APRA that it expected super funds to make release payments to members meeting the eligibility criteria for the scheme “as soon as practicable” after approval from the ATO.
The government’s early access to super measure allows retrenched workers and those whose working hours have been reduced by 20 per cent or more to access up to $20,000 of their super.
“In the vast majority of cases, this should be no longer than five business days,” Ms Hume said.
“I welcome this guidance from APRA. Given the importance of cash flow for many people at this critical time, the Morrison government expects super funds to be paying members their money as quickly as possible, and within five business days.
“We understand this is a very challenging time for all Australians. These measures will ensure that Australians impacted by the COVID-19 pandemic will receive this vital financial support as quickly as possible.
“This is an opportunity for the super funds to demonstrate their commitment to their members at the time they need it the most.”
APRA’s guidelines for super funds’ COVID-19 response, updated on Thursday, state that payments must be made by super entities within five business days if they have not identified any compliance red flags around the release.
Formal applications for the scheme will open on Monday, with over 740,000 Australians already having registered interest with the ATO.
Earlier this week, ASIC moved to allow registered tax agents to give advice to existing clients about early access to superannuation without needing to hold an Australian financial services (AFS) licence.