The superannuation sector is calling for policy makers to reconsider relying on the New Payments Platform for Payday Super from next year, and instead extending the use of BECS for Payday Super.
Gateway Network Governance Body (GNGB), the industry owned not-for-profit that manages the Superannuation Transaction Network, today released a discussion paper “to draw attention to the problems associated with making superannuation contribution payments over the NPP, which the government has proposed to mandate as a payment mechanism to facilitate faster super payments.”
Treasury is currently consulting on draft legislation on the Payday Super measure.
“As the RBA pointed out in their recent risk assessment report [on the Bulk Electronic Clearing Scheme], the suitability of NPP for business-to-business payments hasn’t even been properly assessed yet,” GNGB CEO Michelle Bower said.
“For super payments, we know there are existing gaps in functionality when comparing the NPP to existing payment rails. There is much work to be done before we can even make a sensible assessment of the NPP – or alternatives – to ensure super payments can continue to be efficient, cost effective and reliable.”
Bower argued that “the breadth of work required to ensure the suitability of the NPP for superannuation means that there was no way such a project could be completed by the Payday Super proposed introduction date of 1 July 1 2026.
“The super ecosystem is vast, with millions of participants, and we need to assess any changes to payment systems from each of those perspectives in a balanced, independent manner,” Bower said.
“At GNGB we have been working with a cross-section of super ecosystem participants since this measure was announced, and we’ve identified payments as a core issue that must be properly considered before any changes are made, or we risk the integrity of the entire Australian retirement savings system.
“Policy makers should urgently consider allowing the NPP more time to mature and develop sustainable solutions to the issues that the RBA has highlighted, before requiring its inclusion,” Bower said.