Proposed default superannuation panel favours the 'status quo': Baker
Concerns have been raised over the independence of the proposed default superannuation panel and the review period for MySuper products selected under modern awards.
According to the final Productivity Commission inquiry report into default superannuation funds in modern awards, the proposed panel will work within Fair Work Australia (FWA) and will consist of the FWA president, along with equal numbers of full-time members of the tribunal and part-time independent members.
Tria Investments managing partner Andrew Baker said the make-up of the panel "clearly favours the status quo and, given the construct, the role of the independents is really important".
"I think the issue here is whether or not you're actually going to get independents who don't have a particular barrow to push," he said.
Baker added that independent members should not be chosen because they are expected to give a "predictable answer" on the selection of funds under modern awards.
The Productivity Commission stated that the panel should conduct ongoing assessment and wholesale reassessment of selected funds every four-to-eight years, with the intention of removing funds only in exceptional circumstances.
Baker said reassessment of funds should be undertaken no less than every three years, because no one in the wider industry worked on four-to-eight year review cycles.
"I imagine one of the constructs here is, 'we don't want to change it too often because there'll be a disruption involved'," he said.
"How are we going to build a mechanism by which poorly performing funds can actually be excised in a reasonably timely matter, even if it's not an emergency?"
In addition, if a new and possibly better strategy or fund is only to be considered at least four years down the track, it's not very good for Australians, Baker said.
AUTHOR
Staff Writer
Recommended for you
The financial services technology firm has officially launched its digital advice and education solution for superannuation funds and other industry players.
The ETF provider has flagged a number of developments as it formally enters the superannuation space through a major acquisition.
While all MySuper products successfully passed the latest performance test, trustee-directed products encountered difficulties.
Iress has appointed Insignia Financial’s former general manager of master trust and insurance products as its newest CEO of superannuation, who will take over from Paul Giles.
