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Action needed on ERFs
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A fee cap should be imposed on eligible rollover funds (ERFs) to ensure they reflect the cost of the services that are actually provided, according to National Seniors Australia (NSA).
In a submission filed with the Cooper Review, NSA has expressed concern that fees applying to ERFs are among the highest in the industry and cannot be justified by the services they provide.
It said that additional measures were needed to reduce the level of fees on ERFs and that consideration should be given to a percentage cap.
The submission pointed to research that revealed ERFs represented the highest-cost superannuation sector.
“Given that investment strategies are typically very conservative, and effectively capital guaranteed in their risk profile, as well as the fact that ERFs do not provide additional services — these comparatively high fees are concerning,” the submission said.
AUTHOR
Mike Taylor
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