Eliminating compare the pair unfair: ISA
Proposals by the Federal Government that exempts bank-owned and retail super funds from requirements to disclose their investment returns, fees and costs on proposed ‘product dashboards' for superannuation funds would prevent consumers from comparing the pair, Industry Super Australia (ISA) said.
The proposals would exempt bank-owned super funds held through platforms and some legacy products from having to disclose details on dashboards, which would include around 72 per cent of retail funds.
The government was also looking to remove current limited exemptions to choice of fund legislation introduced by the Howard Government at the behest of employers, which ISA said cover less than seven out of 100 Australian employees.
ISA chief executive, David Whiteley, said industry super funds backed access to information to make informed decisions as well as a robust default fund safety net.
"It is unsurprising that the banks oppose having to disclose the performance of their super funds in an easily comparable and transparent manner," Whiteley said.
"We are concerned that these proposals have not been through a rigorous evaluation. In their current form the proposals are internally inconsistent, seeking to extend choice of fund without providing consumers with the necessary information to make informed decisions.
"It is not good enough that the banks want to hide their chronic under-performance from consumers."
In its submissions to the Treasury, ISA has recommended the Government not continue with the changes until the product dashboard regime includes all super products and investment options with no exemptions for banks and retail funds.
It has also asked for a cost benefit analysis of the proposals to remove the Howard Government's choice of fund rules.
Recommended for you
Financial Services Council chief executive, Blake Briggs, is urging Minister for Financial Services, Stephen Jones, to take advantage of the QAR opportunity to reduce regulatory duplication and ensure advice is affordable.
Former chair of the House of Representatives’ Standing Economics Committee, Tim Wilson, is planning a return to politics after losing his seat in the 2022 federal election.
Morningstar is going to offer research ratings of funds in the $3.5 trillion superannuation sector for the first time in response to demand from financial advisers.
Treasurer Jim Chalmers has opened a consultation into the design of the annual superannuation performance test, canvassing views on a range of reform options.
