Superannuation fund trustees have been told that they need to give top priority to have sufficient liquid funds available to make early release superannuation payments.
Superannuation funds have received a joint letter from the Australian Securities and Investments Commission (ASIC) and the Australian Prudential Regulation Authority (APRA) which has reinforced the liquidity issue.
“One of the primary areas of regulatory focus over recent weeks has been monitoring liquidity to ensure funds retain the means to fulfil their payment obligations, including the early release of superannuation payments recently announced by the Government,” the letter said.
“This must necessarily also be a top priority for trustees, who bear ultimate responsibility for maintaining sufficient levels of liquidity to sustain the operation of their funds.”
“Trustees should be:
The letter then goes on to confirm the two regulators have taken a different regulatory approach.
“In order to help trustees focus their resources and attention on responding to the impact of COVID-19, both ASIC and APRA are postponing a range of new and planned regulatory initiatives. While the priorities of both regulators and trustees must inevitably shift during this period, unless ASIC or APRA has granted specific relief, trustees’ legal, regulatory and reporting obligations remain unchanged,” it said.
“Trustees must therefore ensure key business activities, such as administration, are operationally resilient to ensure ongoing processing of member benefits. Trustees should be scenario testing their critical functions and determining (in conjunction with outsourced providers) essential staffing levels and contingency plans to ensure essential member transactions proceed in a timely manner, particularly where such activities are undertaken offshore.”
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