In 2019, the Royal Commission made some recommendations to strengthen the financial services system and the Government has now implemented these recommendations.
We are updating you on the ending of grandfathered payments and the changes to advice fee arrangements.
From 1 July 2013, certain payments made by product issuers to financial services licensees or representatives of those licensees (e.g. advisers and dealer groups) were banned as part of the Future of Financial Advice (FoFA) reforms. However, under those reforms, some of these payments were allowed to continue. These payments are referred to as ‘grandfathered payments’.
If you joined BT Lifetime Super – Employer Plan prior to 1 November 2013 and have since been migrated to BT Super, one or more of the following grandfathered payments may have been deducted from your BT Super account as separate transaction(s):
Since 1 December 2020, these amounts are no longer being deducted from your BT Super account.
From 1 July 2021, you will need to provide your written consent before a fee for financial product advice can be deducted from your account. If such a fee is already being deducted from your account on an ongoing basis, a new consent will not be required until 1 July 2022.
You may also notice changes to the way you authorise the deduction of these fees from your account.
Where you have provided this consent in respect of an advice fee that is deducted on an ongoing basis (e.g. an ongoing adviser fee), this fee will continue to be deducted and paid to the relevant advice entity (e.g. your financial adviser or their licensee) until you direct us to cease paying it or your consent to the deduction of the fee is withdrawn or expires.
For advice fees that are deducted on an ongoing basis for personal advice, you will be required to provide periodic consent (generally annually) for the deduction and payment of the fee to continue. If we do not receive the required consent, we will cease deducting the fee from your account and paying the fee to the relevant advice entity.
You will need to continue to provide your written consent before the Member Advice fee can be deducted from your BT Super, BT Super for Life or BT Super for Life – Westpac Group Plan account. From 1 July 2021, you will notice changes to the way you authorise the deduction of these fees and additional information provided to you as part of that authorisation process.
Under super law, many super funds offer a simple and cost-effective super investment option called MySuper. It offers members who haven't made an investment choice, a simple super solution and a way to compare funds.
In December 2020 we informed you that BT had made the decision to no longer allow one-off Member Advice Fees to be deducted from MySuper accounts for BT Super, BT Super for Life and BT Super for Life - Westpac Group Plan. This decision was made in order to comply with expected legislation that would not have permitted the deduction of any advice fees from a MySuper product.
However, the final legislation has changed and will continue to allow one-off Member Advice Fees to be deducted from MySuper accounts.
As a result of this updated legislation, from 1 March 2021 BT Super, BT Super for Life and BT Super for Life - Westpac Group Plan will allow one-off Member Advice Fees to be deducted from MySuper accounts with consent. You will need to continue to provide your written consent before the one-off Member Advice Fees can be deducted from your account.
BT Funds Management Limited ABN 63 002 916 458, AFSL 233724 (BTFM) intends to retire as responsible entity (RE) of these Funds and appoint Westpac Financial Services Limited ABN 20 000 241 127, AFSL 233716 (WFSL) as the new RE, effective from 1 March 2021.
For the two MIS funds BT Australian Share Fund and BT Split Growth Fund, BT Funds Management Limited ABN 63 002 916 458, AFSL 233724 (BTFM) intends to retire as responsible entity (RE) of these Funds and appoint BT Fund Management No.2 Limited (BTFM2) ABN 22 000 727 659, AFSL 233720 as the new RE, effective from 30 June 2021.
In 2019 the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry (Royal Commission) made a number of recommendations, which are proposed to become legislated in 2021.
As part of these changes, from 1 July 2021 a superannuation fund trustee can’t hold a role to act in the interests of other persons, other than as a super fund trustee.
BTFM is both an RE of some managed funds and a trustee of superannuation funds. BTFM therefore proposes to retire as RE and appoint WFSL/BTFM2 as the new RE.
The change of RE has no direct impact to product features, fees and costs or investment asset allocation. WFSL/BTFM2 are entities within the Westpac Group and the funds will continue to be managed and administered by the same people and resources within BT. BTFM considers there will be no adverse consequences due to this change in RE.
The change of RE to WFSL/BTFM2 will result in a change to the governing board of directors that oversee the funds on behalf of unitholders. We consider this change is in line with best practice governance and will enable the Funds to continue to be managed in the best interests of unitholders while allowing BTFM to meet the requirements of the proposed legislation recommended by the Royal Commission.
The following table shows the Fund(s) you are invested in, the current RE for each Fund, and the proposed new RE for the Fund (from 1 March 2021).
If you have any questions, please speak to your financial adviser if you have one. Alternatively, you can call our Customer Relations team on 132 135 between 8.30am and 5.30pm (Sydney time), Monday to Friday.
This information is current as at 29 January 2021.
The information shown on this site regarding the proposed legislative changes is intended as a guide only. It is not exhaustive and does not constitute legal advice. It is based on our interpretation of the law currently in force on the date of this notification and the proposed Bills and we do not undertake to provide any further updates to the extent that any of the information in this document changes in the future. Consequently, it should not be relied upon as a complete statement of the relevant laws, the application of which may vary, depending on your particular circumstances. Before acting on it, you should seek independent financial and tax advice about its appropriateness to your objectives, financial situation and needs.