The Senate Economics References Committee Inquiry into Superannuation Guarantee non-payment report was released on May 2nd 2017.
The committee recommended that “the government consider amending the
Corporations Act to ensure that the priorities in section 556 apply during all
liquidations, regardless of whether the business being liquidated was operated
through a trust structure” (for background see my submission, here).
If implemented as recommended that will address the priority of unpaid SGT, and it will also address the current gaps in the coverage of employee entitlements (ie amounts outside the FEG scheme caps). It should also significantly improve FEG’s ability to recover amounts paid to trust employees, from their former employers.
ARITA made a submission and appeared before the inquiry. Other recommendations reflecting ARITA input include:
- R20 – Consideration of a Director Identification Number scheme.
- R22 – Allowance of nominal interest on SGC up to the date of liquidation.
- R23 – Enabling insolvency practitioners to pay outstanding SG contributions directly to an employee’s superannuation fund.
- R31 – expansion of the Single Touch Payroll system to all businesses.
Of course there is no guarantee that these recommendations will result in legislation – but it is very encouraging to see them under serious consideration.