Superannuation Clearing House and the Lost Members Framework

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On 14 November 2008 the Minister for Superannuation and Corporate Law, announced the release of a two-part discussion paper on the implementation of the Government's superannuation clearing house measure and possible initiatives to reduce the number of lost super accounts.

The purpose of this discussion paper is to invite feedback on:

• the issues associated with the implementation of the Government's 2008-09 Budget measure to establish an optional superannuation clearing house facility (discussed in Part A of the paper); and
• possible initiatives aimed at improving the lost members framework (discussed in Part B of the paper).

In relation to the clearing house measure, the issues identified in the paper include the division of responsibilities between employers and the clearing house in relation to Superannuation Guarantee and choice of fund, whether the clearing house facility should be contracted to a single or multiple providers, and the regulatory framework which will apply to the clearing house.

Over recent years there has been a significant and steady growth in both the number and value of accounts listed on the Lost Members Register. The latest available data indicate that some 6.4 million accounts totalling $12.9 billion is currently lost. This represents roughly one in five of all superannuation accounts, and an average of one lost account for every two Australian workers. The large number of lost accounts directly impacts on the retirement savings of individuals, while at the same time increasing superannuation provider costs that may be passed on to fund members.

The second part of the discussion paper canvasses possible initiatives to address the problem of lost members, including a proposal to automatically consolidate lost accounts with an active account where one can be identified for the member.

The Government is seeking submissions and comments on the issues raised in the paper.

Submission and comments closing date: 19 December 2008

Address written comments to:

General Manager
Personal and Retirement Income Division
The Treasury
Langton Crescent
PARKES ACT 2600

Email: chsuper@treasury.gov.au

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