Instead, the provider of the calculator merely says that if one assumes these things (the inputs), the output will be 'x'. However, I do not think that makes the calculation itself a statement of opinion. Is it a statement of opinion? Well, it appears that ASIC thinks it is, or could be, because it is based on assumptions and estimates. Clearly a numerical calculation is not a recommendation. Financial product advice is, as you will know, a recommendation, statement of opinion or a record of either. So, a calculator is something which, as its name suggests, performs a numerical calculation. Instead, the trustee uses data it already has about the member, including their current superannuation balance, age and level of contributions.' It is a condition of the relief that the estimate be included on, or accompanies, a periodic statement. Unlike calculators, retirement estimates provide a forecast without the member needing to first enter information themselves. Retirement estimates are typically printed on a member’s periodic statement. Most superannuation calculators start with default assumptions that are not personalised to any one member, but which can generally be altered by the member.' Indeed, it is a condition of the relief that the assumptions can be altered.ĪSIC described retirement estimates as giving 'an indication of what an individual member’s superannuation balance will be at retirement age and their annual income during retirement. Either of these things might be true, but not in my view in the way ASIC says.ĪSIC describes superannuation calculators as 'facilities, devices, tables or other things (including online tools) that are used to make (or find out the result of) numerical calculations about superannuation. Of course, trustees do not have to give personal advice, but the proposals discussed in the Consultation Paper are part of a concerted effort to encourage trustees to do so.īefore turning to the terms of the proposed relief, the obvious question is whether it is needed at all? The relief proceeds on the basis that superannuation calculators and forecasts are financial product advice and often personal advice (although they do not give relief from the best interests obligation). The Government decided an exception was warranted where the conflicting obligation was to an individual member of the fund in circumstances where the trustee is providing personal advice. In so doing they are acting in a way which is directly contrary to Commissioner Hayne's recommendation that superannuation trustees not be allowed to assume any obligations which may conflict with their obligations to members. The retirement estimate relief is due to expire on 1 April 2022 and extending that relief and expanding the relief for superannuation calculators is part of the Government's and ASIC's project to provide more people with more and better financial advice by encouraging superannuation trustees to provide personal advice to their members about their superannuation. As for the relief from holding an AFS licence authorising the trustee to provide financial product advice at all, that too is of extremely limited value given most, if not all, trustees hold a licence with at least a general advice authorisation. Having said this, it is unclear what it would mean to provide an estimated retirement balance in the best interests of the member which of itself might suggest that what is produced by the calculator is not 'advice'. The relief does not provide any relief from the best interests duty which will apply if the calculator or forecast provides personal advice. Similar relief was granted for retirement estimates that permitted trustees to include an estimate of a member's superannuation balance at age 67 based on the prescribed assumptions. They required that the 'the financial calculator does not advertise or promote a specific financial product' and they required the user to be able to change the default assumptions in the calculator. You may recall that ASIC granted class order relief from the obligation to hold an AFS licence to provide financial product advice and to give a financial services guide or statement of advice for providers of 'financial calculators' if the conditions in the class order are satisfied. ASIC says that both calculators and forecasts provide useful 'tools' to members to think about their superannuation.
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