Increased default fund competition could save $292 million a year in fees

Increasing competition between super funds could save $292 million a year in fees, says the Financial Services Council.

The FSC has released research, by Deloitte Access Economics, which indicates increasing competition among MySuper super funds could reduce total administration fees by 13%, or $292 million a year.

FSC CEO Sally Loane said: “The evidence is clear. If competition reforms are introduced to allow all funds to compete in an open and transparent market, fees in superannuation will fall dramatically.” Read more...

FSC calls for Super 2.0, ISA calls it more cross-selling and bundling

The Financial Services Council has called for strengthened governance and increased competition in the superannuation system, which Industry Super Australia says is a call for more cross-selling and bundling of super products by the major banks.

FSC CEO Sally Loane used the release of the FSC/UBS State of the Industry 2017 report to call for ‘Super 2.0’.

“Our 25 year old super system has done pretty well up till now. But in order to ensure this superb piece of public policy is fit for the next generation – where consumers and choice rule and Millennials choose to work in the gig economy – we need to design Super 2.0.” Read more...

Financial Services Council rejects super safety net claims

In response to claims by Industry Super Australia that recent reviews of the superannuation system had supported the current system for choosing default superannuation funds the Financial System Inquiry has written a letter to the editor of The Australian:

Re: End default super battle, retail funds told

Industry Super Australia’s claim that “a series of reviews had already endorsed existing arrangements” for default superannuation under Modern Awards is wrong. (”End default super battle, retail funds told”, The Australian, February 5). The reviews have in fact been critical of the role of the Fair Work Commission in selecting default funds. Read more...

Superannuation battle lines drawn ahead of FSI final report

Financial System Inquiry (FSI), Industry Super Australia, Financial Services CouncilThe battle lines have been drawn between Industry Super Australia and the Financial Services Council ahead of release of the Financial System Inquiry (FSI) final report.

Industry Super Australia CEO David Whiteley says the superannuation sector is at a “crossroads.”

“The banks are lobbying hard to scrap the safety net and replace it with a system designed to suit their vertically-integrated business model, which is geared towards profits and dividends to shareholders.”

Super safety net under threat from changes to default super

Industry Super Australia Chief Executive David Whiteley has used a speech to the National Press Club to argue that the superannuation safety net is under threat.

The National Press Council on Wednesday was the latest forum for the continuing fight between the Financial Services Council and Industry Super Australia over default superannuation funds.

Opening the speeches David Whiteley said that “the heart of our super system has been the default super safety net.”

Superannuation system “middle of the pack” internationally

Financial Services Council (FSC)/Deloitte Access Economics - International comparison superannuation systemThe Australian superannuation system has been described as “middle of the pack” in terms of investment returns and fees in an international comparison conducted by Deloitte Access Economics.

Titled Financial performance of Australia’s superannuation products, the report was recently released by the Financial Services Council.

Superannuation Returns

According to the report “Australia’s system appears to be ‘middle of the pack’” compared to overseas pension systems. The analysis included twelve pension systems worldwide and found that “Australia has the third highest returns”. Read more...

FSC calls for national retirement income policy

Financial Services Council (FSC) - retirement income policyJohn Brogden, CEO of the Financial Services Council, has announced that the FSC is going to begin work on a national retirement income policy.

“We must embrace the opportunity and lead the debate on taking superannuation from a world class accumulation scheme to the world’s best retirement system”, said Mr Brogden.

He went on to say that the superannuation system must not only provide an income in retirement to “a majority of Australians”, it must also take “intergenerational pressure off the budget”. If the super system fails to achieve these goals the “system and policy has failed”. Read more...

Financial industry shifting focus from regulation to innovation

Financial industry moving from regulation to innovationA survey released by FSC and DST show that financial industry CEOs are looking to refocus efforts from meeting regulatory requirements to product innovation.

Martin Spedding, CEO of DST Bluedoor, said in the 14th annual FSC-DST CEO Survey that:

“Preparing for MySuper, SuperStream and FoFA has been disruptive and costly, diverting resources and attention away from other more productive areas. As this implementation phase nears its end-point, the industry’s leaders are re-focusing on the opportunities of the future.” Read more...