Support grows for MyPension product
Support is growing within the superannuation industry for the development of a MyPension product, with AustralianSuper amongst the latest bodies to support the proposition.
AustralianSuper has used its submission to the Financial Systems Inquiry (FSI) to oppose the mandating of annuities, but to support a default income stream arrangement.
The big super fund said that it believed that "creating a default income stream derived from members' accumulation account balances is a constructive step in engaging members and potentially reducing the prospect of lump sum withdrawals in the system".
"It takes away the reflex action of withdrawing a lump sum from superannuation when it is not necessary, and not in the member's best interest," the submission said.
The AustralianSuper submission claimed a default income stream supported the philosophy "that this is a retirement incomes system rather than a wealth accumulation system".
The super fund called for the establishment of a Treasury and regulator-supported working group to consider the issue further in circumstances where changes would need to be made including deferral of minimum drawdown for a specified period to give time for contacting members and taking payment instructions, enabling the member to top up the default income stream and to transfer to pension at a specified age, in specified circumstances, without member instruction.
The submission suggested that a ‘no detriment' test covering fees, investment strategy and insurance would also be required.
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