Providers of First Home Saver Accounts (FHSAs) will be hit with a stricter application process after the Australian Prudential Regulation Authority (APRA) released a new draft prudential standard.
APRA announced earlier this week it has prepared an application process and draft prudential standard for registrable superannuation entity (RSE) licensees wanting to operate FHSAs
“APRA has given careful consideration to the requirements that RSE licensees already have to meet. The proposed application form and new prudential standard have been developed taking these existing requirements into account,” APRA deputy chairman Ross Jones said.
On May 28, 2008, the Commonwealth Government introduced the FHSAs Bill 2008 into Parliament. It is intended that FHSAs can be offered from October 1, 2008.
The Bill allows for public offer and extended public offer superannuation licensees (known as RSE licensees), life companies and authorised deposit-taking institutions (ADIs) to provide these accounts.
Under the FHSA Bill, RSE licensees will have to establish a separate trust for this purpose and the Superannuation Industry (Supervision) Act 1993 will not apply to this new trust.
Life companies or ADIs that wish to provide FHSAs need to notify APRA of their intention to do so prior to providing, or offering to provide an FHSA.
On February 8, 2008 the Government released a consultation paper, First Home Saver Accounts: Outline of proposed arrangements, which included proposals for the delivery, administration, regulation and taxation of FHSAs.
