Threat to corporate funds and master trusts
A huge question mark is hanging over corporate superannuation funds and retail master trusts as a result of the Government's approach to the Productivity Commission's recommendations on default funds under modern awards.
That was a key issue raised during a roundtable conducted this week by Money Management's sister publication, Super Review, ahead of the Association of Superannuation Funds of Australia (ASFA) national conference starting in Sydney tomorrow.
Deloitte partner and superannuation specialist Russell Mason pointed to the issue at the Super Review/Metlife roundtable and said the huge question mark hanging over corporate funds and master trusts was based on what would happen to them if they were not made default funds and were therefore not able to receive award contributions.
Mason said the legislative changes likely to impose such a regime on corporate funds and master trusts had already passed the lower house in Canberra and he was surprised the Federal Opposition had not made it a larger issue.
ASFA chief executive Pauline Vamos acknowledged the issue and said that the lobbying by corporate funds had been intense and "the issues raised by them are very real".
However she said she believed the minister's office [Financial Services Minister, Bill Shorten] was listening and that, as a result, as a minimum it was possible the industry would get some grandfathering or a little more.
"What is going to be interesting is that if this legislation goes through, as amended, and if it is not changed or removed by the Coalition, it will change the whole landscape because if you look across the whole 150 awards that are in there, some have one fund in them, some have 21 funds, so as a minimum it will change the whole competition landscape," Vamos said.
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