ISA warns on defaults and ‘inappropriate advice’

ISA productivity commission inappropriate advice industry super australia superannuation fund

11 December 2018
| By Mike |
image
image
expand image

Industry Super Australia (ISA) has again differed with the Productivity Commission (PC) and has warned against people being defaulted into only one superannuation fund citing, amongst other things, the danger of “inappropriate advice”.

In a late submission filed with the PC, ISA said it did not support members being defaulted into one fund for life.

“The risk that disengaged and low-information members will be sold, nudged or defaulted into poor quality funds by their bank, their employer or through inappropriate advice is too great,” the submission said.

“To fulfil the collective social policy purpose of compulsory superannuation, it is appropriate for government to intervene strongly to ensure members are protected from such risks. We have previously explained how this can be achieved in the context of a strengthened industrial safety net,” it said.

The ISA noted in its submission that the PC had indicated that it was trying to get rid of unintended multiple accounts by having members, new job entrants default once and then auto-consolidating accounts thereafter.

It noted that the PC had also referred suggestions that members had one account that followed them through their life, with the member taking their balance with them and rolling it over with every next job.

 

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

Interesting. Would be good to know the details of the StrategyOne deal....

3 days 18 hours ago

It’s astonishing to see the FAAA now pushing for more advisers by courting "career changers" and international recruits,...

3 weeks 1 day ago

increased professionalism within the industry - shouldn't that say, FAR register almost halving in the last 24 months he...

4 weeks 1 day ago

Insignia Financial has made four appointments, including three who have joined from TAL, to lead strategy and innovation in its retirement solutions for the MLC brand....

2 weeks 3 days ago

A former Brisbane financial adviser has been charged with 26 counts of dishonest conduct regarding a failure to disclose he would receive substantial commission payments ...

2 days 16 hours ago

Pinnacle Investment Management has announced it will acquire strategic interests in two international fund managers for $142 million....

1 day 19 hours ago