Senate passes bill to allow super fund choice
The Senate has passed the Treasury Laws Amendment (Your Superannuation, Your Choice) Bill 2019, which will allow consumers to choose their own superannuation fund instead of being forced into one because of enterprise agreements.
In a joint statement from the Treasurer Josh Frydenberg, and Jane Hume, Assistant Minister for Superannuation, Financial Services and Financial Technology, said the amendment would allow around 800,000 Australians to make choices as to where their retirement savings are invested.
“The bill addresses the findings of the Financial System Inquiry and the Productivity Commission Inquiry into the efficiency and competitiveness of the superannuation system which found that this reform was ‘much needed’ and that denying choice of fund can discourage member engagement and lead to them paying higher fees,” the statement said.
“This reform is also supported by a recent decision of the Fair Work Commission (FWC) which found that it was detrimental to employees to restrict them from being able to choose their own superannuation fund.
“Specifically, the FWC determined that extending choice of fund to employees who were previously denied choice will prevent them from unnecessarily ending up with multiple superannuation accounts with all the inconvenience and additional administration costs that this involves.”
The changes would build on earlier reforms from the Government which protected superannuation accounts from being eroded through capped fees on low balance accounts and requiring insurance to be provided on an opt-in basis for new members under 25 years of age.
AUTHOR
Chris Dastoor
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