Industry Super Australia (ISA) has consistently stated that industry super funds support a ‘Member Outcomes’ Test and increased disclosure and enhanced trustee obligations, but that such requirements must result in the same obligations and disclosure outcomes regardless of the type of investment option applied to.
The current Government superannuation Bills DO NOT ensure consistent outcomes across MySuper (typically not-for-profit super funds) and Choice (typically retail funds) products; nor do they fix gaping disclosure gaps exploited by the retail super sector.
Industry Super Australia believes the Government’s Bills are significantly flawed. The Government has been unable to gain the support of the Senate and has been unwilling to:
- Extend a legislative ‘outcomes’ test to ‘choice’ super products that comprise 80% of retail super assets
- Address obscured practices involving fee disclosure or the undisclosed investment fees and expenses of bank owned and other retail super funds
- Implement simplified ‘choice’ product disclosures legislated 4 years ago
- Require comprehensive disclosure of bank super fund dividends derived from fees paid out of super fund assets
- Require full and transparent disclosure of underlying assets of retail super funds
- Extend APRA licencing and directions powers to effectively capture complex bank super structures
- Comprehensively address unpaid super
ISA chief executive, David Whiteley, said the Government’s resistance to strengthening its own bill is inexplicable.
“It is inexplicable that the Government seems unwilling to require the same Member Outcomes test and the same disclosure outcomes and transparency measures for Choice products, which are typically bank-owned and retail funds.
“The Senate recognised many of the Government’s super proposals were not even handed and advantaged retail and bank-owned super funds, potentially leaving their members in the dark about fees, costs, dividends, and unexplained underperformance.
“The withdrawal of these Bills presents the Government with an opportunity to put political partisanship aside and work with the entire superannuation sector to develop an even-handed approach to regulation that delivers tangible benefits to members,” said Mr Whiteley.
David Whiteley is available for interview. Media contact: Phil Davey 0414 867 188.
Industry Super Australia provides policy, research and advocacy on behalf of 16 not-for-profit Industry SuperFunds who are the custodians of the retirement savings of six million Australians.