I know that it is cliched but my expectations in January for 2020 were nothing close to how this year is turning out. On New Year’s Eve I was standing in the middle of thousands of strangers, in the heart of Vienna, with my mother as we counted down to the New Year thinking about what it would bring. I had high expectations for 2020, it was going to be even more amazing than 2019. I was moving to a new city, starting a new job, learning new skills and knowledge, and making new friends. Then Covid-19 hit Australian shores and the nation, and in line with the rest of the world, we went into isolation.
In the midst of navigating what was our new norm, I watched the IQ team step out of traditional roles and unite as a team, to ensure the transition to a virtual business was seamless and successful. Steering committees were formed, help buddies were assigned and IQ Connects was formed. IQs first priority was reaching out to everyone in our team to make sure they were okay, and they had all that they needed. IQ Connects became the network where internal communication and information tools brought us together. But more than that, it is about conversations, activities and personal connections that provide support and community. We now have virtual exercise, trivia and family fun competitions as well as facilitating our Friday Social Time. We are still a team!
I have been involved in a range of projects since our isolation began in March, allowing me to create a greater knowledge base and seize opportunities I would not have otherwise had. Whether it’s been regulatory change such as the COVID-19 early release of benefits, or Best Practice Business Processes, the past eight weeks have shown me the importance of adaptability, resilience and courage; not just in business but in life. These are qualities that I have noticed IQ Group employees have in spades, qualities that are nurtured and encouraged by the Executive team and have allowed us to continue to do our best work for our customers.
Two-thousand and Twenty has not begun anything like I thought it would. Being a grad has not been what was expected when I first started with IQ Group. The world has changed but this is a time I am going to remember for the rest of my life.
On 5 May 2020, IQ Group’s CEO, Brian Peters, hosted a virtual session on pandemics impact on the Governments regulatory agenda, with IQ Group’s Head of Industry Insights – David Haynes providing commentary on the key impacts for the Industry.
Six months ago, the Regulators were overseeing a substantial regulatory change agenda, driven largely by the findings of the Financial Services Royal Commission. Today that agenda, in most part will experience delay however, even though the Industry post COVID-19 may be quite different operationally, the RC findings incorporated in the Regulators change agenda stand firm for implementation.
The discussion covered a wide range of topics:
NEW LEGISLATION AND THE CURRENT ENVIRONMENT
The Government is still planning to introduce new legislation and implement the remaining Royal Commission’s recommendations. This new legislation will have a significant impact on the financial services industry and is expected in the next few weeks. Upon release, Funds will once again move into “review mode”, assessing current programs and re-prioritising delivery.
CHOICE PRODUCT REPORTING
APRA will be updating MySuper Heatmaps from December last year and will be issuing a revised version for June 2020, with updated information on fees and performance. The interesting development here relates to Choice Heatmaps, with an expected delay of a year or so. The Retail Funds have been identified as the most impacted by the Choice Product Reporting and no doubt this delay will suit their operations and provide further time to assess product offerings for rationalisation.
DATA COLLECTION & OUTCOMES ASSESSMENT
Following on from Choice Product Reporting, there was general discussion on Outcomes Assessment and how Funds should already have similar/and or same data points about their products as normal course of business. That certainly is the case for Funds with a dedicated Product team whose responsibility is to continually assess product benefits for value-to-membership and prospective members. The trick here is that the final APRA data requirements for Choice Products will have nuances of difference, compared to internal Fund reporting. Couple that with the Data Collection specifications and technology which has experienced delays in the rollout of the upgrade, and all of a sudden we are now looking at a greater complexity associated with this requirement.
LIQUIDITY & EARLY RELEASE OF SUPER BENEFIT
Liquidity is a hot topic at the moment and questions were put forward about the Regulators and how they are viewing liquidity. There is certainly a heightened focus on liquidity, with APRA and ASIC issuing a joint letter to Trustees on the matter. With respect to the new Early Release of Superannuation benefit, there will be continual monitoring and reporting by APRA which is expected to be maintained whilst this benefit remains available to Fund members. At this stage $7.5b is forecasted for withdrawal across the approx.1 million applications received. In the coming weeks, we can expect a Fund Level report to be made available by APRA regarding this benefit. The real interesting story here, is that if it wasn’t for the MAAS, MATS and Single Touch Payroll implementations, the Government would not have been in a position to model the impacts of such a benefit and determine a “best duration period” that supports both short term benefit to Australians with the least amount of long term impacts on retirement. There’s a big tick here across Government, Regulators and Funds on the call-to-action in mobilising these payments.
THOUGHTS ON THE NEXT 12 MONTHS
There’s a rich landscape of priorities and many challenges.
First thoughts go to Accountability. Apart from the immediate WFH impacts, what we are really talking about is the Financial Accountability Regime – FAR. This framework will crystalise the weight of responsibility on key organisational roles to ensure appropriate and transparent processes are in place, and carried out on both material decision making and day-to-day running of superannuation funds.
Next on the list is Communications, engaging with members and the technology that supports a level of agility to respond to varying circumstances for growth, retention and issue resolution.
And finally, we come to Data….can’t stress enough that prudent decision making is underpinned by readily accessible, near-to-real-time data. Technology is a key component, driven by appropriately skilled personnel with a wide range of expertise across the Industry.
Managing Principal – IQ Group
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