Industry superannuation funds should not be required to cross-subsidise financial planners and others who appear before the newly-constituted Australian Financial Complaints Authority (AFCA), according to the Australian Institute of Superannuation Trustees (AIST).
On the same day that the chair of the AFCA, former Liberal minister, Helen Coonan confirmed that AFCA would be funded by an APRA-style levy, the AIST warned against cross-subsidies by stakeholders, including superannuation funds.
AIST chief executive, Eva Scheerlinck, said there was a moral and legal obligation on super funds to ensure that members’ savings were not used to fund the resolution of complaints in other areas of the finance sector.
“It would be unacceptable, inequitable and unfair if members’ retirement savings were used to fund the resolution of disputes unrelated to superannuation, such as complaints against banks and financial advisers,” Scheerlinck said.
AIST’s submission to AFCA also raised concerns about a lack of transparency in AFCA’s proposed funding models for three different stages covering transition, interim and long-term funding.
“We request that AFCA release detailed cost projections for each dispute resolution stream to enable super funds to better understand how members’ savings are going to be used and how much will be collected from each industry sector providing the funding,” Scheerlinck said.