Medicare to take over compassionate superannuation release
Medicare will be responsible for the administration of early release of superannuation on compassionate grounds following the introduction of new legislation into Parliament.
Assistant Treasurer Bill Shorten said "Medicare Australia has been managing these claims for almost six months, under delegation from the Australian Prudential Regulation Authority (APRA)."
"It makes sense, given their experience in managing electronic business transactions and greater focus on customer service, to transfer the function permanently."
Currently, APRA is responsible for administering the early release of superannuation on compassionate grounds. However, this function does not fit well with APRA's role as a prudential regulator, and has been undertaken by Medicare Australia under delegation.
The Government considers this function would be administered more cost‑effectively following formal transfer to an agency which has an efficient customer support infrastructure.
While the purpose of superannuation is to provide benefits for members on retirement on reaching preservation age, a member's preserved superannuation benefits may be released before preservation age in some strictly limited circumstances.
Over $1.5 million was released in compassionate payments in the 2010/11 financial year, with an average amount of $11,316.00.
These circumstances include compassionate grounds release, which covers expenses in respect of medical treatment, medical transport, modifications necessary for the family home or motor vehicle due to severe disability, palliative care and funeral expenses. Funds may also be released to prevent the foreclosure of a mortgage or exercise of a power of sale over the member's principal place of residence.
The criteria for early release of superannuation on compassionate grounds will remain the same.
"There is significant potential to streamline the program with the ultimate beneficiaries from this transfer being those superannuation fund members experiencing undue hardship because of their personal circumstances," Mr Shorten said.
More information is here.