IQ Group Wins Best Superannuation Industry Consultancy 2019

IQ Group Wins Best Superannuation Industry Consultancy 2019

This year IQ Group was one of the winners of the 2019 Australian Enterprise awards, hosted by APAC Insider, taking out Best Superannuation Industry Consultancy 2019.

The Australian Enterprise Awards returns for the 3rd year to acknowledge businesses and individuals who have played a pivotal role in the resurgence of one of the world’s biggest economies. As one of the top 15 highest grossing economies in the world, Australia boasts many individuals and organisations from across a myriad of sectors and industries deserving praise and recognition.

In a time of such unprecedented industry and market change for the superannuation and wealth management industries, we are proud to be included among the businesses and individuals being showcased for their contributions and achievement.

To find out more on APAC Insider and the Australian Enterprise awards, visit www.apac-insider.com.

About IQ Group:

IQ Group is Australia’s trusted consultant and first choice delivery partner to the Superannuation and Wealth Management industry. IQ Group understands the technological and regulatory forces impacting organisations. We provide first-rate project delivery and independent expert advice on technology and processes to meet the needs of the latest regulatory environment.

Read More: https://www.apac-insider.com/2019-iq-group-australia.

A Look Into IQ Group’s Graduate Program

A Look Into IQ Group’s Graduate Program

Over the years, IQ Group has developed a great Graduate Program to kick-start the careers of new graduates and introduce them to the world of superannuation consulting.

With our 2019 Graduate Program well underway, we thought it would be a great opportunity to check in with our team of Graduates, Carmen Yang, Justin Robb and Damien Huynh, to find out what work they are doing and their motivations for joining the program.

Left to Right: Damien, Carmen and Justin. 

Q.) How long have you been in the IQ Group Graduate Program?

 Damien: Well, Carmen and I have been here for a month.

Carmen: Yeah, just a month.

Justin: I started the last week of January, so I’ve been here almost 2 months now.

 

Q.) What were you doing before joining the program?

Carmen: I was finishing my master thesis at the University of Auckland prior to coming on board.

Damien: Well I was just watching Netflix – nah I’m joking! I just finished my degree and graduated in December.

Justin: I recently transitioned from a completely different career. I’ve been in teaching for the last several years, and prior to that I was in IT. I’ve been jumping around and trying to figure things out, and I’ve figured out where I want to settle.

 

Q.) What motivated you to apply?

Damien: I was looking for a job that would give me exposure to different companies. I didn’t want to be stuck with the typical 9-5 job. I wanted to experience something different and to develop problem-solving skills and apply those to the companies that I was working for. IQ Group provided that, which was really good. That was one of the points that made me want to apply.

Justin: So as I mentioned previously, I was working in a different industry for quite a while. I’d been thinking for a while, due to some industry instability, that I wanted to get back into something that was more stable.

After hashing it out with my wife for quite a while, figuring out what I was going to do and how I was going to get there, I ended up meeting with Brian [IQ Group’s CEO] while he was in Sydney in June last year. Brian asked if I’d thought about coming and seeing IQ Group. He explained that the Graduate Program had been completely revamped and was very different from the last time I had worked there. So after looking around at a number of different job boards and workplaces, I found the Graduate Program to be the best fit for me in terms of getting back into the industry. The exposure is huge, as Damien said, and it’s a great way of getting into a lot of different businesses and gaining different skills, experiences and building a really good career foundation for myself.

Carmen: So I had similar career aspirations and knew I wanted to get into consulting. I decided to apply because of the reach of companies and the scope of learning I could do. As Belinda [IQ Group’s Resourcing Manager] was interviewing me, she told me about the various roles that they offer. There are four different streams and there’s a chance to see which of them I like. I was very interested in this because I want to be a jack-of-all trades.

 

Q.) What work have you been doing as part of the program?

Damien: Our first 4 weeks in, they sent us to [a client] and I was placed in the PMO team, helping out with support. While I’ve been working there, I’ve been attending meetings, taking minutes, shadowing project managers and learning exactly what the process is when starting a new project up to its launch date.

Carmen: I work in the CRM testing platform team. Over the last three weeks I’ve been doing a lot of Salesforce work and testing. What I’ve been doing is helping with [a client] transition and data dictionaries, and helping with Salesforce testing.

Justin: I spent the first week just going through the motions, learning what consulting is, about IQ Group and what we are doing in terms of super and our clients. I have done a lot of LinkedIn Learning to up my skillset, and we’re learning BABOK and RG146 to get qualified for consulting work.

In terms of my client, I started off there doing a little bit of admin and backlog clearing. There’s a lot of the clients user documentation that needed cleaning quite urgently.

And recently I’ve jumped on a new project that’s started up in the last couple of months with Pam and her team. Without going into too much detail, I’ve been doing a lot of data mapping work. Due to the ramifications of what we do, I can’t say too much about it, but I’ve been quite heavily involved with the project manager, product managers, lead [Business Analyst’s] (BA’s) and people at all levels in order to generate this program.It’s been great being an integral part of a key project for our client and helping them to deliver a new product to their clients. While it’s been a challenge to step up to the responsibility this early, I’m really enjoying it.

 

Q.) What have been the highlights of working with IQ Group?

 Damien: The highlight for me has been just being able to experience firsthand what it’s like to be a consultant. This years’ graduates were fortunate to engage with clients very early. I think the method IQ Group has adopted enabled us to get an early preview of what we should be expecting. And the people are really nice, which is really important; especially when you’re looking at the kind of company you want to work for.

Carmen: For me it’s similar. The thing I’ve enjoyed the most has been getting hands-on with the client-facing roles. Getting to know the ins and outs of IQ Group and the client early on has been really rewarding. Another thing that I’ve enjoyed has been the support we’ve been given from the IQ staff every time. Especially my team leader, Steven, and the support and guidance he has been giving us since we got here has been really helpful. The people and the culture have been really nice.

Justin: When I was looking at making my career change, the thing that I really wanted to get into was BA work. I was looking into what BA’s do and the skillsets required, and I thought this is something that’s right up my alley and it’s exactly what I’m looking for.

When I was doing my initial interview with Pam, I explained BA experience is what I’m after, and she said being a BA is what she does and that’s the type of work I would get. It’s been pretty awesome to jump straight into work, get all of that down and start applying some of it at the client sites and to know that the pathway is there.

It’s great to know that I have goals in place to get to where I want in future, and that there are people who have already done it supporting me to get there. They know exactly what to do and can answer pretty much anything I come up with in terms of a struggle or problem. It’s really good to know that there is that support in place.

Anyone who starts a Graduate Program has probably just finished a whole bunch of study and to then be told ‘well, now that you’re working, you’re going to spend another 2 or 3 months studying some more’ isn’t really what they want to hear. Being able to get onto the client site straight away is definitely a bonus. Learning hands-on is very useful for both the company and ourselves.

 

To find out more about IQ Groups Graduate Program, visit: http://www.iqgroup.com.au/graduate-program/

 

Outcomes Assessment Act: Powerful New Legislation Targets Under-Performing Super Funds

Outcomes Assessment Act: Powerful New Legislation Targets Under-Performing Super Funds

Powerful new legislation targets under-performing super funds and a whole lot more

The new Members Outcomes legislation really packs a punch and it’s surprising there hasn’t been more media about its likely impact. Big new powers for APRA, a new test funds must pass to stay in the industry, restrictions on fund inducements to employers and new investment disclosure laws will separately and jointly have a major impact on the industry. Each element will require careful analysis and planning by funds.

In a frenetic and sometime confusing penultimate week of Federal Parliament before the election, the Government finally passed its Improving Accountability and Member Outcomes in Superannuation legislation – passage of the legislation was in doubt until it actually passed. The legislation was signed into law on Friday by the Governor General.

The legislation has been before parliament for almost two years but it still got addressed faster than some other legislation, like the Objective of Superannuation Bill that is still languishing after three years.

APRA gets new super powers…

APRA has welcomed its broader directions powers to take action against under-performing super funds, and to take civil penalty action against funds not meeting their best interests of members obligations. This means that APRA doesn’t have to wait for the law to be broken but can now intervene at an earlier stage – before members suffer significant harm.

What this means in practice is that APRA will be pursuing under-performing funds to merge or exit the industry. Many funds with less than $1 billion of assets are likely to be in this basket, and a small number of larger funds. APRA will be under scrutiny to show that it can quickly and effectively manage this task and do so in a way that doesn’t further disadvantage the members of these funds.

…but APRA didn’t get everything it wanted

The legislation also requires funds to undertake annual outcomes assessment against prescribed benchmarks, including all of their MySuper and choice product options. This is where APRA didn’t quite get what it wanted and APRA is working out how the prudential standard it issued last December will need to be amended to accommodate the new legislation.

In the final version of the legislation criteria to be considered in the outcomes assessment was reduced. Under the amended bill, the focus of both MySuper and choice assessments has to be on fees and costs, returns, and investment risk. This means that the APRA requirement to benchmark member services (for example) as part of the test no longer applies. This is a victory for those who have called for the outcomes assessment to be focused on long-term net returns, with other matters to be secondary considerations.

The legislation also gives the Government powers to make regulations relating to the outcomes assessment requirements suggesting that APRA’s outcomes assessment prudential standard may also be displaced by the regulations.

Super funds will have to hit the ground running now that we finally have more clarity about outcomes assessment requirements. Funds have until January 2020 to get their draft outcomes assessment plan in place so the preparation of these plans is going to jump to the top of fund priority issues.

Prohibition on employer inducements

The legislation was also amended to implement the Financial Services Royal Commission recommendation that funds be prohibited from inducing employers to have them nominate the fund as a default fund. Funds and their associates breaching these new laws will be liable to civil penalties.

While the industry is still waiting on details of the scope of this prohibition (eg, does a sponsorship arrangement contravene this law?) directors of funds need to review existing practices, ensure compliance or risk facing possible civil penalties.

Portfolio Holdings Disclosure

Twice a year, funds now must disclose details of their investments, to level of the underlying asset held directly or through associated bodies. Funds will be required to publish the details of their portfolio holdings on their websites within 90 days after each June 30 and December 31 reporting date.

Annual Member Meetings

Finally, the legislation also requires APRA-regulated funds to hold annual members’ meetings.

 

Written by David Haynes

 

Good News: A “Nothing” Federal Budget for Superannuation

Good News: A “Nothing” Federal Budget for Superannuation

In a welcome respite from years of major changes, there wasn’t much in last night’s Federal Budget about superannuation. The few changes were relatively minor and non-controversial, including:

  •       Permanent Capital Gains Tax relief for merging super funds
  •       Relaxed contribution rules for older Australians
  •       Increased funding for regulators
  •       Adjustments to reflect the final Protecting Your Super Act
  •       Establishment of a Superannuation Consumer Advocate

The changes announced in the Budget require legislation. Parliament will sit for the next few days, but an election on 11 May is likely to be called on this coming Sunday or Monday.

We have detailed the superannuation changes in the Budget below:

The Government has announced permanent Capital Gains Tax relief for merging funds. Previously, this relief has been granted on a temporary basis. There are likely to be significant fund mergers in the near future and this will ensure some members receive an increased benefit.

From 1 July 2020, 65 and 66 year-olds will be able to make voluntary contributions (both concessional and non-concessional) to their superannuation without having to meet a work test. Currently, people aged 65 and over have to work for a minimum 40 hours over a 30 day period in the relevant financial year.

People aged 65 and 66 will also be able to make up to three years of non-concessional contributions under the bring-forward rule. People up to and including age 74 will be able to receive spouse contributions, with those 65 and 66 no longer needing to meet a work test. Currently, people aged 65 to 74 can only make voluntary contributions if they work a minimum of 40 hours over a 30 day period in a financial year. People aged 65 and over cannot access bring-forward arrangements and those aged 70 and over cannot receive spouse contributions.

The Government says that aligning the work test with the eligibility age for the Age Pension (scheduled to reach 67 from 1 July 2023) and increasing the age limit for spouse contributions to 74 will give older Australians greater flexibility to save for retirement.

The Government will provide $42 million over the next few years for the ATO to recover unpaid tax and superannuation liabilities including from large corporate entities and high wealth individuals.

They will ramp up regulator spending by more than $640 million, including:

  • over $400 million to ASIC to support its new enforcement and supervisory strategies
  • over $150 million to APRA to strengthen supervision and enforcement
  • over $35 million for a new criminal jurisdiction of the Federal Court.

As a result of the Government agreeing to amendments to the Protecting Your Super Package the  Budget was amended to take account of:

  • extending to 16 months the period after which an account that has not received any contribution is considered inactive;
  • expanding the definition of when an account is considered active for the ATO-led consolidation regime; and
  • requiring the ATO to consolidate to an active account, where possible, within 28 days of receipt.

The Government has also announced its intention to establish a Superannuation Consumer Advocate and called for expressions of interest.

We would love to hear what you think of the changes announced in the Federal Budget. Leave us your thoughts and comments below. If you would like to find out more about how these changes will impact you, you can contact us at enquiries@iqgroup.com.au.

 

Written by David Haynes

Super’s Biggest Challenges in Insurance Claim Handling

Super’s Biggest Challenges in Insurance Claim Handling

The introduction of the Insurance in Superannuation Voluntary Code of Practice has meant greater consequences for funds that fail to comply. Should the Code become binding and enforceable, as recommended by the Royal Commission, then the consequences of non-compliance go one to become far more significant. It is more important than ever that funds have the right tools and processes in place to ensure they are able to make the right calls.

Last week, IQ Group ran their second discussion group on Claims Handling under the Code of Practice. Attendees of the discussion covered the range of challenges they were facing and discussed potential solutions. Here are some of the biggest challenges that were identified.

Reduced Claims Handling Timeframes

With the reduced timelines under the code, it is more important than ever to clarify at an early stage whether a member is making a claim, a complaint or some other contact.

Claims that are lodged late, or that have multiple or changing elements, were identified as being particularly difficult. Managing expectations was identified as key, with participants emphasising that funds shouldn’t make representations they cannot meet.

It may be difficult for large funds to be able to guarantee that a claimant was always able to talk to the same primary contact person, although some are able to do this.

Visibility of Member Information

There was significant discussion around the lack of visibility and access to relevant member information.

It was proposed that there should be a single, comprehensive view of claimant members to improve the member experience and the efficiency of claims handling. During the discussion, it was also was noted that the Insurance in Super Working Group recommended the development of functionality that could be owned by funds and cover all interactions with insurers, administrators, medical, legal and rehabilitation providers.

MAAS is Creating Volumes of Work

New reporting of changes to member details to the ATO (MAAS services) has led to increased reporting of deceased members to super funds – and these increased volumes are likely to continue. Many of these deceased members have died years ago but are only now triggering death claim processes due to the introduction of MAAS.

There is uncertainty about what reasonable steps need to be taken to pay unclaimed death monies (eg, notices in newspapers). Trustees need a policy to deal with unpaid death benefits. It was noted that unclaimed death benefits didn’t necessarily involve insurance claims but might just relate to the members superannuation benefit. IQ Group will therefore be drafting an unclaimed death monies policy and we will be providing this to those that participated in the recent claims handling discussion groups.

Identifying Vulnerable Members

There was discussion around how funds addressed vulnerable consumers. As the identification of a vulnerable member can be somewhat subjective, it is an area that warrants further discussion and definition. Vulnerable members need to be clearly identified, along with a rationale for their inclusion and an articulation of their additional needs. The discussion group identified a need for adequate reporting tools (eg, in workflow management systems) to capture these members and their contacts with the fund.

If you have identified any of these issues in your claims handling processes and would like to discuss possible solutions to these issues, you can reach out to us at sgosios@iqgroup.com.au.

2018’s Big Superannuation Changes – And What We Can Expect From 2019

2018’s Big Superannuation Changes – And What We Can Expect From 2019

While the turmoil in Federal Parliament and the Financial Services Royal Commission were getting all the headlines, other low-key but very important changes had the biggest impact on super funds in 2018 and will again in 2019.

Productivity Commission Report Not the Main Game

Opinion polls have been pointing to the ALP as the favourite to win the next election. Either way, the priority of the Government after the election is going to be on implementing the recommendations made by the Financial Services Royal Commission. The recommendations made by last week’s Productivity Commission’s report on superannuation are going to have a lower priority, although they will continue to influence the policy debate.

Many of the Productivity Commission’s recommendations echo the draft recommendations they made last year, many of which have already been picked up by the Government or incorporated into the Insurance in Super Code. Their signature recommendation of allocating new entrants to the workforce one of ten “best in show” funds (unless they choose an alternative) is a political hot potato that probably won’t be implemented.

Royal Commission Report Set to Dominate the Policy Debate

The Financial Services Royal Commission will issue its final report right on time on Friday, 1st of February 2019, and the Government will make it public immediately. Whatever recommendations are made by the Royal Commission, it is highly likely that both the Government and Opposition will commit to implement all of them after the election.

My prediction is that the Royal Commission will recommend:

  • a ban on “grandfathered” trailing commissions;
  • more litigation and less negotiation with companies that break the law;
  • a new superannuation regulator;
  • a new or increased focus on conduct regulation;
  • a large number of prosecutions arising out of their case studies.

All of this is going to take a while to put in place. Legislation is not likely until the end of 2019 and implementation will take place from 2020.

In the meantime, the larger industry funds are experiencing higher than forecast member and contribution flows as they are perceived to have fared much better than their retail competitors at the Royal Commission.

While the superannuation world waits for changes arising from these high-profile commissions of inquiry, the APRA Outcomes Assessment Test, the Insurance in Super Code and re-engineered super fund reporting to the ATO are requiring major investments from funds and are already driving major changes.

New APRA Test, ATO Reporting and Insurance Code the Real Drivers of Change

APRA Outcomes Assessment:

APRA released a package of new requirements for APRA-regulated super funds in December 2018 intended to strengthen the delivery of quality outcomes for fund members. The key change is an annual outcomes assessment, requiring funds to annually benchmark and evaluate their performance in delivering these outcomes as part of their business planning cycles. Not only will this lift standards in super, it will also facilitate the merger of poor performing funds into better performing funds.

New ATO reporting:

New systems for super fund reporting (known as the MATS and MAAS projects) to the ATO will require funds to report on a near real-time basis, thus helping to identify employers not meeting their obligations. This will massively increase the volume of information being sent to the ATO and will mean that myGov and new online commencement forms will have much more comprehensive and up to date information.

Insurance in Super Code of Practice:

Most super funds are in the process of implementing higher standards and quicker claims processing for their members as part of implementing the Insurance Code. Many of the changes in the PYS legislation and recommendations made by the Productivity Commission were already incorporated in similar requirements of the Insurance Code. This includes the cessation of insurance cover for low account balance members and opt-in insurance for many younger members.

IQ Group is Here to Help

The IQ Group is keeping abreast of all these changes and is both mapping their impacts for many of our clients and designing and implementing solutions that improve the member experiences.

If you have questions or would like to find out how IQ Group can assist, contact us at enquiries@iqgroup.com.au.

 

Written by David Haynes