ACCC delivers industry funds clean bill of health on advice
The Australian Competition and Consumer Commission (ACCC) has given superannuation funds a qualified but nonetheless clean bill of health on the issue of allowing members to access external financial advisers.
The competition regulator has stated that it does not believe that any particular superannuation fund wields enough market power to fall into the category if misusing that market power.
The ACCC gave its response after the chairman of the House of Representatives Standing Committee on Economics, Tim Wilson specifically referred the activities of six superannuation funds for the regulator’s consideration including UniSuper, AustralianSuper and Cbus.
“While the ACCC has not reached a concluded view in relation to whether any of the superannuation funds identified in the materials provided by the Committee has a substantial degree of market power, the ACCC notes that the Australian superannuation industry has low market concentration, with the top four superannuation funds accounting for less than 20% of industry assets,” the ACCC said.
“The ACCC considers market concentration as part of its overall assessment of whether a particular business has market power. Where there is a market with low concentration, it is unlikely that any one particular business has market power. Nonetheless, we acknowledge that a range of other factors affect the degree of market power held by superannuation funds, so have considered this question on the basis that one of more of the funds may have a substantial degree of market power.”
“The ACCC considers that, on the information available, even if a particular fund has a substantial degree of market power, a decision by that fund to limit a customer’s ability to use their superannuation funds to pay for financial advice from a third party adviser is unlikely to substantially lessen competition in any market,” the regulator said.
“The ACCC notes that any restriction imposed on customers’ use of their superannuation funds would not prevent customers using alternative funds to pay for financial advice from other financial advice providers, and absent further information, accordingly a substantial lessening of competition is not apparent.”
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