Australia’s largest industry superannuation fund, AustralianSuper has expressed concern that the Government is looking to legislate to pave the way for superannuation funds to offer complex post-retirement products without the provision of personal advice.
In a submission filed with the Senate Economics Legislation Committee, AustralianSuper said it believed the Government should complete its promised retirement income framework before proceeding to put in place the means testing and other arrangements for new post-retirement products.
It said that as a superannuation trustee, it had concerns about the operation of the means-testing rules and the need for a consumer to understand that they were entering a long-term trade-off for means testing purposes.
“AustralianSuper as a fiduciary is concerned as to application of these rules to new [comprehensive income in retirement] CIPR products which are designed to be offered by superannuation trustees to their members without personal advice,” it said.
“Traditionally, these types of products have been sold to customers directly not through the fiduciary overlay of superannuation. A higher duty is owed by superannuation trustees as fiduciaries than applies under contract law,” the AustralianSuper submission said.
The submission was at odds with those of the Financial Services Council (FSC), Challenger and Mercer, all of which have urged the Senate Committee to promptly pass the Social Services and other Legislation Amendments (Supporting Retirement Incomes) Bill 2018 which was intended to put in place the underpinnings for the development of new types of retirement income products.
However, AustralianSuper said it did not believe it was the right time to impose means test treatment on limited types of retirement income products based on current products in the market and in circumstances where future innovative products had not been developed, pending the retirement incomes framework being fully developed by Government.