The Federal Government might be dragging its heels on the subject of a policyholder protection scheme for general insurance, but it will improve access to financial assistance for people whose superannuation is lost as a result of fraud or theft.

The move, announced last week, follows the Government’s decision to remove the need for small businesses to report superannuation contributions to employees.

Assistant Treasurer Helen Coonan says the decision follows the release of a review of the Superannuation Industry (Supervision) Act 1993 that allows people to apply for financial assistance.

Federal Opposition spokesman Stephen Conroy says the Government’s initiative represents minimal assistance and fails to provide adequate compensation in critical areas if the regulatory system fails.