Superannuation system should promote choice and competition
The Financial Services Council (FSC) has expressed concerns regarding Labor's announcement that it would take a package of additional superannuation taxes to the next Federal election as this would cause further uncertainty for savers, and in particular for women, carers and the self-employed.
Although the FSC has urged ‘both sides of politics' to work towards a superannuation system which would promote choice and genuine competition and concluded that the government's super tax reform was a step forward, it said that the competition reform should still be made the priority.
According to the FSC, the superannuation system must be reformed to promote choice and competition in a way that:
- All Australians should be free to choose their own superannuation fund;
- Comparable MySuper products should be free to compete on a level playing field where the barriers of industrial relations protection have been removed; and
- All trustees should be required to appoint independent directors, in part to facilitate industry consolidation.
The FSC also supported the superannuation tax proposals announced in the 2016 Federal Budget and welcomed the Government's consultation with the industry. However, it expressed some concerns regarding a significant cost to consumers arising from the Government's proposed changes to transition to retirement arrangements.
FSC's chief executive, Sally Loane, said: "Australians want certainty and confidence in superannuation. They want to be free to choose their own super fund and they want employers to be able to offer them a choice of funds".
"More than anything they want political parties to draw a line in the sand under changes to the tax treatment of super so they can plan confidently for their financial future."
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