AUSTRALIA - The government has issued a discussion paper to try to tackle superannuation restraints and reduce the number of lost super accounts which now totals almost A$13bn (US$8.5bn) .
In the 2008/09 budget, the Australian government announced funding of A$16m over three years to establish an optional superannuation clearing house facility to cut the red tape burden on businesses across the country.
Sherry explained one of the key costs small businesses faced was meeting the requests of their employees to have their super paid into many different funds.
He said: "For many employers, the process of complying with the choice of superannuation fund rules not only imposes costs, but can divert resources away from their core productive business activities.
"The optional clearing house facility will help relieve this burden by allowing employers to pay their contributions to a single location and will be cost free for employers with fewer than 20 staff."
Sherry claimed the clearing house would also manage employers' obligations under Superannuation Choice, including the time-consuming task of checking details entered on the choice form and disbursement of contributions to the nominated funds.
The key issues identified in the paper included the division of responsibilities between employers and the clearing house in relation to the Superannuation Guarantee and choice of fund obligations, and the regulatory framework for the clearing house.
The second part of the paper canvassed possible initiatives to improve the operation of the lost members' framework.
Sherry added: "The current lost members' framework has been ineffective in stemming the growth of lost superannuation, with both the number and value of lost accounts rising sharply between 2001 and 2008 to an incredible 6.4 million lost accounts worth A$12.9bn."
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