Industry funds defend value of advertising
Industry superannuation funds have defended their right to pursue major advertising campaigns against suggestions that the Government intends outlawing such activities via changes to the sole purpose test with the Superannuation Industry Supervision Act (SIS Act).
Industry Super Australia (ISA) which has acted as a central coordinating unit for some of the industry funds advertising campaigns has defended advertising as “a cost-effective way to attract and retain members passing on the benefits of scale”.
What is more, ISA pointed out that industry funds advertising campaigns had not been the target of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.
Commenting on reports of the Government’s proposed changes, ISA said it welcomed “all universally applied laws that would mandate spending by super funds”.
However, it said these should be solely for the financial benefit of members – “not the parent company’s shareholders”.
“Advertising is a cost-effective way to attract and retain members passing on benefits of scale. It is also a useful financial literacy tool to help explain to members the impact on their savings of potential policy changes,” ISA said in a formal statement.
“All ISA’s activities are in the best financial interests of members – this is a statement Banking Royal Commissioner Kenneth Hayne agreed with.”
“Media reports have suggested the proposed changes to the sole purpose test are deliberately designed to disadvantage industry funds,” it said. “ISA will carefully examine if the effect or intent of the legislation is to damage industry funds competitive position in the marketplace.”
ISA chief executive, Bernie Dean said addressing the problems of superannuation should be beyond politics or ideology.
“While some seem intent on using these reforms to pursue ideological objectives at the expense of member outcomes - our focus is firmly on ensuring they are in members' best interests, just like with everything we do.
“We’d be concerned if the government was returning to the old battle lines, because we know that will lead to poor financial outcomes for members.”
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