Overview

The Government announced the unclaimed moneys measures in the 2012-13 Mid-Year Economic and Fiscal Outlook. The Bill makes amendments to the Banking Act 1959 (Banking Act), First Home Saver Accounts Act 2008 (FHSAs Act), Life Insurance Act 1995 (LI Act), Superannuation (Unclaimed Money and Lost Members) Act 1999 (SUMLM Act), Australian Securities and Investments Commission Act 2001 (ASIC Act), and Corporations Act 2001 (Corporations Act) to give effect to the unclaimed moneys measures.

Schedule 1, 2 and 3 amend the Banking Act, FHSAs Act and LI Act to reduce the period of inactivity before a bank account or life insurance policy is required to be transferred to ASIC from seven years to three years, effective from 31 December 2012. (Please see Part A).

Schedule 4 amends the SUMLM Act in relation to two classes of unclaimed moneys. One class of unclaimed superannuation moneys relates to ‘uncontactable’ members and accounts which have been inactive for five years, while the other relates to ‘unidentifiable’ members. The amendments increase the account balance threshold below which lost accounts are required to be transferred to the Australian Taxation Office (ATO) from $200 to $2,000, effective from 31 December 2012. A ‘lost account’ is one where the member is uncontactable, or the account has been inactive for a period of five years. Separate to the first change, the amendments also reduce the period of inactivity before an account of an ‘unidentifiable’ member is required to be transferred to the ATO from five years to 12 months, effective from 31 December 2012. (Please see Part B).

Schedule 5 amends the Corporations Act and ASIC Act to streamline arrangements for the administration and distribution of unclaimed property and funds that arise under the Corporations Act, including closing the Companies and Unclaimed Moneys Special Account (CUMSA). (Please see Part C).

The Bill will also for the first time enable the payment of interest when these unclaimed superannuation, bank account, life insurance and company monies are reclaimed, from 1 July 2013, to maintain their real value over time. The Government intends to introduce legislation in early 2013 to exempt this Consumer Price Index (CPI) interest from tax. (Please see Part D).

In short, the Bill will bring forward the time at which money is recognised under the relevant laws as lost or unclaimed. By bringing forward the time when details are published in publicly searchable databases, the Bill will help to reunite people with their money sooner. It will also help to protect these superannuation, bank account, life insurance and company moneys from erosion by inflation and fees and charges.

Next: Part A - Banking, FHSAs and Life Insurance (Schedule 1, 2 & 3)
Previous: Submission to the inquiry into Treasury Legislation Amendment (Unclaimed Money and Other Measures) Bill 2012
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