Default super needs an independent umpire: CSSA
Fair Work Australia (FWA) lacks the "specific knowledge and the necessary experience" to make decisions about the selection of default superannuation funds, according to the Corporate Super Specialist Alliance (CSSA).
While the CSSA welcomed the interim report of the Productivity Commission into default superannuation funds, it argued that decisions about the selection of funds should be made by a new expert body independent of FWA - with FWA playing a minimal role.
CSSA treasurer Gareth Hall said FWA had been subject to significant criticism in its handling of recent enquiries.
"Their impartiality has been brought to question and they have taken a long time to come to a conclusion, which would lead us to question if they have the necessary resources to take on this role," he said.
Administrative issues aside, the CSSA congratulated the Productivity Commission for "recognising the need for reform in the default superannuation environment".
The Commission's recommendation that employers, under any circumstances, be allowed to choose a fund not listed in an award is "quite a breakthrough", Hall said.
"We feel it is very important to allow employers to be able to tailor their superannuation offering to suit their employees, as the roles of employees that are employed under a particular award can be very diverse," he said.
However, the CSSA is concerned about the onus put on employers to prove that their employees are no worse off, Hall added.
"We believe that this requirement of proof needs to be carefully quantified so that an employer is aware that they have met the criteria required at the time a fund is selected, as if this is not the case this would provide a significant disincentive for an employer to make a selection outside the funds nominated in an award," he said.
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