Productivity Commission has handed super system efficiency & competition report to Government

Nest egg, superannuaiton, SMSF, retirement
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The Productivity Commission has given its report on the efficiency and competitiveness of superannuation to the Government. Though it might not be released before the next Federal election.

Update: The Government has released the Productivity Commission report, but is waiting for the final report of the Banking Royal Commission before giving its response to the recommendations.

The Productivity Commission says it handed the final report of its inquiry into the efficiency and competitiveness of Australia’s superannuation system to the Government on 21 December 2018.

This final report is the culmination of the review by the Productivity Commission into the superannuation system. It follows from the second stage of the inquiry, which considered alternative ways to select default super funds. The third and final stage stemmed from a recommendation of the Financial System Inquiry: “Introduce a formal competitive process to allocate new default fund members to MySuper products, unless a review by 2020 concludes that the Stronger Super reforms have been effective in significantly improving competition and efficiency in the superannuation system.”

The draft report included several potential recommendations, including that default super accounts should only be created once for new members of the workforce and that these workers should be presented with a ‘best in show’ shortlist of up to 10 superannuation products.

The review might not be released before the approaching Federal election. The Productivity Commission notes that, under the Productivity Commission Act 1998, the Government is required to table the report in the Parliament within 25 sitting days of receipt. But, based on the published sitting calendar, the latest the report could be tabled is in June – beyond the expected May election. Though the Government could release the report sooner.

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