Hockey recruits Turnbull to review MIA

A review of the Managed Investments Act is to be undertaken by Malcolm Turnbull, financial services minister Joe Hockey announced in Melbourne this morning.

“We have to conduct a review under the terms of the Act and this will be completed by the end of this year,” the minister said.

No terms of reference have been set as yet, but Hockey hopes the review will be conducted widely.

He admits some of the benefits of the act, like a fall in unit pricing, haven’t followed through and that will probably be one item Turnbull will look at.

With the report due at the end of the year, and an election being tipped for December, Hockey says an election will not have any impact on the report being delivered.

“The report may be delivered early, but there are no problems with an election and the delivery of the report,” he says.

Hockey is still confident the Financial Services Reform Bill will meet the October 1 implementation date.

“If we do not meet October 1, then I suspect the bill may not become law for another 12 months with the election coming up,” he says.

Another fear the minister has, if the bill is delayed in the senate, will be further scrutiny by Parliament, which will change the proposed legislation.

Hockey is adamant that no interested parties are going to be allowed escape clauses from the bill, but an implementation delay could start the lobbying process again from pressure groups.

One area he is keen to remain in the bill is member choice for superannuation.

Hockey again confirmed no superannuation fund would be excluded, including the powerful industry funds, which have been lobbying hard to have to have choice removed.

“For me it is a major issue and any attempt to remove clauses from the bill will delay it in the Senate,” he says.

The minister was in Melbourne to launch Equity Trustees’ new ethical fund.

The fund will invest in Australian equities with a slant towards indexing. A total of 300 equities have been filtered and the usual suspects, such as gambling, tobacco, alcohol, uranium and the sex industry have been excluded from the fund.

One major equity, BHP, has recently been taken out of the fund because after the merger with Billiton, it now owns a uranium mine.

It is believed this is the first time BHP has been excluded from an ethical fund.

The ethical fund has zero entry fees and a 1.1per cent management fee.