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Continuing concern over award super
Employee choice will not be sufficient to overcome the imbalance created by proposed new award superannuation arrangements, according to the principal of consulting firm Chant West, Warren Chant.
Chant made clear during a Super Review round-table conducted at the Conference of Major Superannuation Funds on the Gold Coast that he believed some employers and superannuation funds faced being significantly disadvantaged by the award superannuation arrangements proposed by the Australian Industrial Relations Commission.
However, the chief executive of the Australian Institute of Superannuation Trustees, Fiona Reynolds, said she could not understand the fuss that was being created over the award superannuation issue.
"The fact of the matter is, 80 per cent of Australians still are in a default fund, there has to be some mechanism for people to be in those default funds.
"The employers don't want to choose. Maybe some do, but I don't think the majority of employers want to go around deciding. Choice still overrides," Reynolds said.
"If you decide, 'I don't want to be in this default fund', you don't have to be in it. If you as an employer decide, 'I don't want a bar of any of these default funds that are in the award', you can set up an EBA [enterprise bargaining agreement] and put what you want in the EBA of any fund. I think there's some other agenda that's driving a lot of people to be saying things about the award process that I don't think are true," she said.
However, Chant countered by claiming that establishing an EBA was not an easy process for employers.
"Yes, they can choose to be in another fund and you say to the employer you can set up an EBA, [but] that's a hell of a lot more difficult than actually being nominated as a default fund in an award.
"In other words, it's all very well to say if the employer doesn't like it they can set up an EBA, but that's not a simple process," he said.
"I think you've got to stop saying employees can exercise choice because that's not the issue," Chant said. "For smaller employers, and I don't know how you define 'small employers', but let's say someone with less than 15 employees, to set up an EBA is just not practical.
"There are bigger issues in your life in running a business. So what I'm saying is that I think there's definitely a kind of a reduction in competition in the industry through this system."
AUTHOR
Mike Taylor
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