Best interest duty urged for banks, AMP on super
If default funds under modern awards should be opened to competition by all approved MySuper funds, then the approved product lists (APLs) of the major wealth companies should also be opened up to competition.
That is the assessment of Sunsuper chief executive, Scott Hartley who has told a roundtable conducted by Money Management's sister publication, Super Review, that he believes the major banks should also be required to meet a best interests test with respect to providing superannuation products via employers.
On the question of injecting competition into the award super environment, Hartley said there was a need to look more broadly at the competitive factors.
"…If you're talking about barriers to competition in the sense of the award members we should also talk about competition in terms of bank customers, advisers and banks or AMP for that matter," he said.
"Large wealth companies opening APLs to competition is an equal measure that I think would create a more competitive type of field for industry and for consumers… It's not just about competition in awards it should also be about more competition, improved product lists," Hartley said.
Other members of the roundtable panel agreed with Hartley that a strongly competitive environment needed to be maintained, and that there was a need to prevent third line forcing on the part of the major banks.
However Deloitte partner, Russell Mason said legal protections existed against third-line forcing and he believed the major trade unions would be vigilant in ensuring that it was not allowed to occur.
Superannuation Complaints Tribunal chairperson, Jocelyn Furlan said she believed the over-riding requirement was fairness.
"…It's going to be really important that competition - if it is open to competition - that [it] is fair and there is a focus on making sure that whatever decisions employers make about default funds is actually going to work for members and that they're not going to find themselves at the end of an arrangement that involves a whole lot of other things that's not to do with their membership of the super fund, that it's in the members' interest," she said.
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