Industry Super Australia (ISA) has accused Government policy-makers of caving into big bank pressure to shape new rules around Single Touch Payroll (STP) initiatives to remove consumer protections so they can increase market share.
SA chief executive, David Whiteley claimed bank priorities were being put ahead of the superannuation of millions of Australians in the ATO’s new digital process to register and track businesses hiring new employees involving the use of STP.
He claimed this would be occurring without people having access to fee or investment return comparisons – something which could prompt them to choose a fund other than their employer’s default fund.
Whiteley claimed the changes were in danger of being implemented without Parliamentary scrutiny, bypassing the current Productivity Commission review of default super and ignoring the default system overseen by the Fair Work Commission representing an “ ‘under the radar’ plan to subvert the shortlist of trusted high-performing default funds”.
Whiteley claimed the proposals suggested the bank campaign to change the super system to suit their vertically integrated and scandal-prone business models was working.
“New employees, including those starting their very first job, could be pushed into choosing a super fund without the information to make an informed choice, or the reassurance of a default fund safety net,” he said. “It appears policymakers are caving in to bank pressure to remove consumer protections so they can increase their market share,” Whiteley said.
The ISA chief executive pointed to an ISA submission to the ATO on the issue which recommended the Government postpone the STP fund choice until the Productivity Commission inquiry was complete and redraft the design to support informed decisions.
