Minister for Superannuation and Corporate Law Nick Sherry today said he does not intend to legislate minimum balances for self-managed superannuation fund (SMSF) accounts but has urged professional bodies to confront this issue themselves.
Sherry told delegates at the Self-Managed Superannuation Fund Professionals' Association of Australia (SPAA) conference in Adelaide that ASIC had concluded a viable minimum balance of $140,000 was required for a two-member SMSF account.
"I would encourage SPAA and the sector to confront this matter going forward," he said. Sherry said he had similar conversations with the three major accounting bodies last week.
He said he continued to be concerned about several aspects of the SMSF system.
Trustee education is the baseline for reform, Sherry told delegates.
"While the majority of trustees are doing a good job, many others have no idea on their responsibilities," he said.
This was demonstrated in the latest Australian Taxation Office survey - 30 per cent could not explain the sole purpose test and 15 per cent did not have an investment plan, Sherry said.
"It is unsustainable for the system and dangerous for the reputation of your sector to allow this to continue," he said.
"Do trustees understand the risks? What risks are posed to the whole SMSF system as a whole and the retirement incomes in full? What are the implications for system and cost of pensions if things go wrong?
"With government responsible for pensions for those when returns are not maximized, we have a key interest and responsibility."
