Co-contribution commissions slammed
By Mike Taylor
Retail superannuation funds have come under heavy criticism for charging fees and deducting commissions on contributions made as a result of the Government’s co-contribution regime.
Commenting on the start of an industry superannuation fund advertising campaign ahead of choice, the chief executive of the $600 million Tasplan fund, Neil Cassidy, said that fees were the key differentiator between industry and retail funds.
“It is difficult to justify or defend the sort of asset-based administration fee charged by some retail funds and master trusts when the end result is that the more a person contributes to super, the more that person is slugged in fees,” he said.
According to Cassidy, a ‘sleeper’ in the whole debate about fees is the fact that some funds are actually charging fees and deducting commissions from the co-contribution payments being made by the Government into the accounts of eligible employees.
“In other words, fees and commissions are being taken from taxpayer funds contributed by the Government; this is on top of the same deductions being made out of the 9 per cent superannuation guarantee,” he said.
Cassidy claimed the only thing stopping a public outcry by both employers and employees was that most people just don’t know about it.
“The embarrassment and culpability factors here for the Government are enormous, with taxpayer funds and employer contributions being effectively ‘garnisheed’ to pay commissions and shareholder dividends,” he claimed.
Recommended for you
Professional services group AZ NGA has made its first acquisition since announcing a $240 million strategic partnership with US manager Oaktree Capital Management in September.
As Insignia Financial looks to bolster its two financial advice businesses, Shadforth and Bridges, CEO Scott Hartley describes to Money Management how the firm will achieve these strategic growth plans.
Centrepoint Alliance says it is “just getting started” as it looks to drive growth via expanding all three streams of advisers within the business.
AFCA’s latest statistics have shed light on which of the major licensees recorded the most consumer complaints in the last financial year.
