Industry Super Australia (ISA) has attacked the Federal Government’s superannuation reforms, accusing the Government of pursuing an ideological attack on industry funds and unions rather than responding to the industry’s problems.
ISA said that the Government’s bills before the Senate failed to address any of the substantive issues facing the superannuation industry. It pointed to recent allegations of fee gauging by bank and retail superannuation funds as evidence of the bills’ weakness.
ASIC is reportedly investigating bank-owned and retail superannuation funds over conduct that may have cost consumers over $1 billion from 2013 – 2017. Big bank funds allegedly delayed transferring members into lower cost super products in this time, potentially even swapping them into more expensive ‘choice’ products.
ISA public affairs director, Matt Linden, said that the Government’s proposed legislation fails to prevent the behaviour leading to the fee gouge from occurring again, and may even go as far as to enable it to do so.
“The bills seek to broaden choice to enable the banks to spruik their super products to even more unwary Australians without adequate disclosure and safeguards,” he said.
Rather than responding to problems with the superannuation industry, ISA believes that the Government is using the reforms to pursue an ideological vendetta against industry funds and unions.
It said that “the Government has resorted to dog-whistling about the role of unions on trustee boards.” This follows increased focused by the Government on director fees paid to union trustees.
ISA also questioned why the reforms target industry super funds, as it asserted that they were the best performing part of the sector and do not have the history of misconduct of bank and retail funds.
Minister for Revenue and Financial Services, Kelly O’Dwyer, has previously denied that the Government’s super reforms are targeted towards unions and industry super funds.
ISA called on the Government to withdraw its legislative proposals and sit down with the superannuation industry to find another solution to improving member outcomes.
