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ASFA urges opt-out on consolidation
The Federal Government should consider making superannuation fund members specifically opt-out of the consolidation processes that will inevitably accompany the use of tax file numbers (TFNs) as primary identifiers within superannuation funds.
That is a key bottom line of a submission filed by the Association of Superannuation Funds of Australia (ASFA) with Treasury this month.
ASFA argues that it has been the experience in the superannuation fund industry that members do not always appropriately respond to correspondence - something that would make "opt in" consolidation arrangements problematic.
"Funds' experience of member's responding to correspondence suggests that for 'within fund' consolidations the appropriate mechanism may be disclosure through the Product Disclosure Statement (PDS) and the member being given the option to opt-out prior to consolidation occurring," the submission said.
Elsewhere in its submission, ASFA has also expressed concern that the Government's Stronger Super proposals "do not appear to contemplate a requirement to provide appropriate disclosures on impacts of consolidation on product benefits such as insurance.
It warned of the dangers of the consolidation processes generating multiple marketing programs run by all funds resulting in a saturation of members with 'tick here to consolidate' mailings.
AUTHOR
Mike Taylor
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