Licensing gets nod
The Australian Prudential Regulation Authority (APRA) can rest easy with the knowledge that a majority of people in the superannuation industry believe trustee licensing will ultimately work to strengthen the sector.
The results of the latest IUS/Super Review Super Outlook survey found a strong majority of respondents believed the industry would become stronger as a result of the process, and despite the challenges involved in obtaining a Regulated Superannuation Entity (RSE) licence, most believed the process was not unduly difficult and would ultimately be worth it.
However, the survey results also reveal an industry belief that superannuation funds would increasingly be controlled by professional trustees rather than those drawn from the industries or callings they represent.
Asked to consider the impact of trustee licensing on the superannuation industry, the vast majority of respondents (95.2 per cent) believed it would become stronger as a result of the process, with 33.3 per cent suggesting it would become much stronger.
And while there has been a good deal of discussion about the difficulties funds have encountered in terms of ensuring they obtain their RSE licence, most respondents to the survey (59.5 per cent) said they felt the processes introduced by the APRA were about right.
It was significant, however, that when the responses to the survey were measured against the occupations of the respondents, superannuation fund executives and trustees themselves were found to err towards suggesting the process was too onerous.
Significantly, most respondents to the survey believed the licensing process would ultimately serve to change the make-up of trustee boards, leading to domination by so-called professional trustees.
Asked whether trustee licensing would lead to the domination of professional trustees, 63.4 per cent of respondents said they believed this was likely to be the case.
AUTHOR
Mike Taylor
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