Superannuation bills introduced by the Coalition Government into Federal Parliament today risk dismantling the not for profit superannuation sector and giving the banks a ‘leave pass’ on some new transparency and disclosure requirements.
Australians will be concerned that the Government’s agenda is not about improving governance and transparency but advancing the commercial interests of the banks:
- The Strengthening Trustee ArrangementsBill will dismantle the successful industry super and not for profit super governance model.
- The Improving Accountability and Member Outcomes in Superannuation Bill2017 will enhance trustee obligations and regulatory powers in the default super sector but not 83 per cent of retail sector assets dominated by big bank-owned funds.
The government has still not advanced any evidence that their proposals will improve returns for members.
The evidence is clear: for the ten years to 30 June 2017, SuperRatings monthly data shows, on average, industry super funds have outperformed bank-owned super funds by more than 2 per cent a year*.
Meanwhile, within the banks:
- ANZ has had to pay an extra $10.5 million to 160,000 customers after ASIC found it had incorrectly processed members’ super contributions and failed to deal with lost inactive member balances correctly.
- Commonwealth Bank has had to repay an estimated $105.6m for charging fees where no advice was provided. As of 19 May 2017, CBA had repaid or offered to repay $5.85m.
- ASIC alleges Westpac subsidiaries provided personal advice to customers, recommending they “roll out of their other superannuation funds into Westpac-related superannuation accounts” even though they were not legally allowed to provide personal financial advice.
- NAB’s super trustee, NULIS Nominees, had to repay $34.7 million to 220,000 super accounts in Feb 2017. It charged “planned service fees” between Sep 2012 & Oct 2016 to clients who had either received general advice or where no plan adviser had been appointed to provide advice.
*ISA analysis of SuperRatings Fund Crediting Rate Survey, SR50 - balanced option medians, June 2017
Industry Super Australia chief executive David Whiteley is available for interview.
Media contact: Lis Bowdler 0412 112 374.
Industry Super Australia provides policy, research and advocacy on behalf of 15 not-for-profit Industry SuperFunds who are the custodians of the retirement savings of five million Australians.