Labour pans super portability paper
The Federal Government has released a paper outlining the implementation process for its policy on the portability of superannuation, but has come under immediate criticism from the opposition who have labeled the paper as ‘weak and wimpy.’
The consultation paper was released by the Minister for Revenue and Assistant Treasurer Senator Helen Coonan as part of the Government’s ongoing efforts to have choice of fund introduced, with Coonan saying that portability should begin on the same date as choice of fund, July 1 2004.
Coonan says the Government is keen to introduce portability of superannuation funds because APRA figures show that currently there are more than 24 million superannuation accounts in Australia, or about two to three accounts for every person who can have an account.
"As a complement to choice of funds, this will allow members to consolidate their superannuation benefits in one account, reducing the impact of fees and charges. This policy will also benefit Australians by creating greater competition in the superannuation industry, leading to reduced fees and charges and more responsive investment strategies by trustees,” Coonan says.
However shadow minister for retirement incomes and savings Nick Sherry says the Government has missed the point and should ban entry and exit fees on funds and introduce automatic consolidation of accounts.
Sherry says fees in many cases cost thousands of dollars if a member wishes to transfer between superannuation funds and the Government could not expect fund members to move their super if they are charged at these levels.
Furthermore, he says the Government’s suggestion to monitor fees was an easy way out of the issue and the majority of the 24 million accounts in existence can be legally consolidated but fund members do not take that step because of the paperwork and complexity required.
AUTHOR
Jason Spits
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