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Education more important than regulation
The Cooper Review into superannuation has been warned against overreacting to the implications of the global financial crisis by going too far on regulation and compliance.
The warning is contained in the submission to the inquiry filed by Queensland insurer Suncorp, which said the review needed to “be alert to the potential, in considering governance, to be seen to be reacting to a ‘moment in time’ financial crisis in a way that will add complexity and cost to the system through additional, unnecessary compliance requirements”.
It said additional compliance could be to the long-term detriment of workers and their superannuation and Australia’s future over the long term as Australians struggled to close the retirement income gap.
The submission said while the global financial crisis had served to frighten many superannuation fund members, it had also served to place superannuation in its correct context as a long-term, tax-effective investment to help Australians save for their retirement.
“Accordingly, we do not believe the impacts of the [global financial crisis] mean the super system is broken or that recommendations should be made to the Government based on the incorrect perception that the [global financial crisis] has left the superannuation system broken,” it said.
The Suncorp submission said rather than moving to add to regulation and compliance, the Cooper Review would be better in seeking to educate Australians about market cycles, the importance of investing over the long term and the impact of staying the course.
AUTHOR
Mike Taylor
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