ISA calls for bank super scrutiny

industry-super-australia/funds-management/compliance/superannuation-funds/industry-super-funds/trustee/chief-executive/government/

9 December 2014
| By Mike |
image
image
expand image

Future debate around the governance of superannuation funds needs to be evidence-based and be inclusive of bank-owned funds, according to Industry Super Australia (ISA).

Issuing a response to the Financial System Inquiry (FSI), the ISA said it supported the inquiry's call for bipartisan agreement on the purpose of the superannuation system and the need for policy stability.

"Equally, future debate on the governance of superannuation funds needs to be evidence based," it said. "The representative trustee system is a feature of industry super funds, public sector funds and corporate funds. These funds return all profits to members, and have on average, outperformed bank-owned super funds over the past 17 years according to data published by the regulator, APRA."

ISA chief executive, David Whiteley said industry funds welcomed a debate how to ensure the super system aced exclusively in the interests of fund members.

"I am confident that the Government in considering the most appropriate governance of super funds will be reviewing the governance of bank-owned super funds. Specifically, they will want to investigate the trade-off between returns to members and dividends paid to bank shareholders," Whiteley said.

He said the issue of returns to members and dividends paid to bank shareholders was "the most obvious cause of tension and inefficiency in Australia's compulsory super system".

"All the evidence points to the representative trustee system being the model that puts members' best interests front and centre and has delivered stronger investment returns and ultimately bigger super nest eggs," Whiteley claimed.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

So we are now underwriting criminal scams?...

2 months 2 weeks ago

Glad to see the back of you Steve. You made financial more expensive, not more affordable as you claim, and presided ...

2 months 3 weeks ago

Completely agree Peter. The definition of 'significant change is circumstances relevant to the scope of the advice' is s...

4 months 3 weeks ago

ASIC has suspended the Australian Financial Services Licence of a Melbourne-based financial advice firm....

1 week 1 day ago

The corporate regulator has issued infringement notices to three AFSLs whose financial advisers provided personal advice to a retail client while unregistered....

1 week 6 days ago

ASIC has released the results of its first adviser exam to be held in 2025, with 241 candidates attempting the test....

2 weeks 4 days ago

TOP PERFORMING FUNDS

ACS FIXED INT - AUSTRALIA/GLOBAL BOND