Member outcomes centre in 2018 super regulatory landscape
Continuing regulatory focus on outcomes for members will be dominating the superannuation industry in 2018 and will lead to further consolidation of super funds, according to consulting service QMV.
Continued political and public interest in conduct across the financial service sector would be a key theme for 2018, and one part of the scrutiny toward regulation that would shape movements within the make-up of the superannuation space.
“Continued enforcement of conduct related compliance obligations is likely to contribute to an environment where there are lower appetites for reputational and compliance risks,” said QMV principal consultant, legal and risk, Jonathan Steffanoni.
“Aside from the prospect of a Royal Commission directed at financial institutions, superannuation funds will need to ensure standards of conduct in claims handling and management remain compliant and aligned with community expectations of the financial sector.”
Steffanoni said funds would need to up their focus on recommendations that could be early signals of reforms for default superannuation models, and the way in which funds deal with the sector. Similarly, data availability and use and transparency would be key to how major industry players responded to regulatory change.
“While Open Banking may provide some competitive opportunities for integration in the short term, the prospect of louder calls for Open Super or Open Pensions should not be far from the top of the strategic planning agenda for superannuation fund trustees,” he said.
“The focus for most of the industry is likely to be directed towards ensuring that activities and investments contribute to member value and outcomes.”
At the start of the year, Steffanoni said all eyes in the industry would be on the Productivity Commission findings from the third phase of the Inquiry into Competition and Efficiency in the Superannuation System.
Recommended for you
Financial Services Council chief executive, Blake Briggs, is urging Minister for Financial Services, Stephen Jones, to take advantage of the QAR opportunity to reduce regulatory duplication and ensure advice is affordable.
Former chair of the House of Representatives’ Standing Economics Committee, Tim Wilson, is planning a return to politics after losing his seat in the 2022 federal election.
Morningstar is going to offer research ratings of funds in the $3.5 trillion superannuation sector for the first time in response to demand from financial advisers.
Treasurer Jim Chalmers has opened a consultation into the design of the annual superannuation performance test, canvassing views on a range of reform options.
