Superannuation sector facing enforced consumer advocacy

3 December 2019

Amid concerns expressed by some advisers about consumer group influence on the board of the Financial Adviser Standards and Ethics Authority (FASEA), the Government has moved to inject greater consumer influence over the superannuation sector.

The Assistant Minister for Superannuation, Financial Services and Financial Technology, Senator Jane Hume has announced the calling of expressions of interest for the formation of a consumer advocacy body for superannuation in line with the recommendation of the Royal Commission and the Productivity Commission (PC).

In doing so, Senator Hume said it fulfilled the Government’s 2019-20 Budget commitment to identify options to support the establishment of the advocacy body.

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Her statement said the establishment of the advocacy body was a key recommendation of the PC’s report Superannuation: Assessing Efficiency and Competitiveness, which found that superannuation discourse is dominated by the interests of funds and trustees rather than members.

It said that the move was also consistent with commentary in the final report of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry on the benefits of funding consumer advocacy services.

Hume’s statement said that with 15 million members and over $2.9 trillion worth of superannuation savings, it was vital that the superannuation system worked in the interests of all Australians.

“The body will fill a critical void in superannuation policy debates by becoming the voice of consumers,” it said.

The minister’s statement has called on “interested parties” to provide feedback on how the body should be established and funded, its functions, and its governance and accountability arrangements.

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Let's hope those fake "consumer associations" Choice and CALC are not allowed anywhere near this. Those organisations have been hijacked by professional agitators who are completely out of touch with real consumers. They promote dogmatic ideology rather than practical solutions, and end up doing consumers more harm than good. Unfortunately they have already been given far too much influence and funding by the government. This has to stop. Consumers need an organisation to promote consumer interests, not agitator careers.

They will be the first to be appointed...just watch...along with a plethora of groups with strong anti -adviser sentiment and ideology and left wing political connections.
There is a whole bunch of political agitators who make an entire career out of advisory body involvement,advocacy boards and think tanks.
I have significant concerns over where Jane Hume's loyalty really is based.
The Industry Funds would be over the moon they have a previous convert in the midst of current Govt and the silence that Hume has chosen during the FASEA Board debacle and the consumer group based Directors , is starting to appear consistent with where her position is held.
The radical stance that these so called consumer groups take is nearly always focused on remuneration and fees.
This is because they all have an ideological objection to paying commercial costs for just about anything.
Superannuation is a business,first and foremost. It is not a charity, even though many in left wing land would probably like to see a massive socialist style centralised retirement fund for all.
Industry Funds are run as massive, money making ventures and the perception that they are only run for the benefit of the members is just that.
Businesses and shareholders such as Frontier Advisors Pty Ltd, Industry Super Holdings Pty Ltd, Industry Funds Management Pty Ltd , Industry Fund Services Pty Ltd, Industry Super Australia Pty Ltd and The New Daily Pty Ltd are all associated organisations that have made massive profits off the back of Industry Fund involvement and shareholding. There has been a history of a particular long term Director and Chair of the Board (now ceased) of a very large, well known Industry Fund who also held a Directorship of Frontier Advisors Pty Ltd which received the payment of fees from that organisation whilst that same super fund also held shares in that very business and provided services to that fund for a very large sum of money.
So, a Director and Chair of a large Industry Fund was also a shareholder in an organisation in which the super fund itself had a 31% shareholding as at 30 June, 2018 and that organisation provided services to that same super fund .
.....and this is not considered a problem or a conflict of interest ????
.......and this would be all in the best interest of their members and the best interest of consumers?....yes ?

Why are we handing out jobs for failed socialist lawyers?

Some brilliant comments about CHOICE from Peter White of FBAA recently...

“CHOICE is no longer a consumer advocacy group, but an activist group, and it is misleading Australians in subjects it knows nothing about. Activists with social and political agendas certainly have their place, but it is crucial they do not masquerade as legitimate and objective advisers."

Hear, hear! Peter was referring to CHOICE's ideology driven campaigning against mortgage broking, which is likely to make things worse, not better, for consumers in that arena. But his comments could equally apply in relation to financial planning. In fact the situation is far worse in financial planning as CHOICE activists have inveigled their way onto the Boards of FASEA and AFCA where they can use government power to impose their extreme ideology.

The government needs to recognise that groups like CHOICE are really political activists, rather than consumer advocates, and treat them accordingly.

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