BDMs and lawyers pose risk to simple advice

Superannuation funds must ensure that impediments such as overly competitive business development managers and excessively conservative lawyers do not get in the way of simple advice.

That was the warning of the former chief executive of Westpac, David Morgan, to the opening plenary of the Association of Superannuation Funds of Australia conference in Melbourne.

Morgan said there was a need to provide simple and easy advice, and that he had been told the necessary regulatory environment was now in place.

“But the industry needs to ensure that the picture is not complicated by BDMs looking to cross sell or lawyers who are too conservative,” he said.

Morgan also pointed to the manner in which consolidation in the banking industry had lowered costs, and said super funds should consider the benefits of similar consolidation.

“Industry consolidation dramatically lowered costs in banking to some of the lowest in the world,” he said. “Super may well benefit from similar consolidation.”