Super and regulators on agenda for Financial Systems Review
The draft terms of reference of the Government's Financial Systems Review will see both the performance and structure of the regulators brought under the spotlight along with the role and governance of superannuation funds.
The Treasury, Joe Hockey, announced the time-table for the review along with the fact that it would be chaired by David Murray, but it was the terms of reference which provided the most compelling indicator of its ultimate outcome.
The degree to which the Review will be empowered to traverse issues of superannuation fund governance and control is reflected in the terms of reference allowing it to "examine changes in the way Australia sources and distributes capital, including the intermediation of savings through banks, non-bank financial institutions, insurance companies, superannuation funds and capital markets".
However the terms of reference also speak of "changing organisational structures in the financial sector" and "corporate governance structures across the financial system and how they affect stakeholder interests".
The terms of reference will also provide the Review panel scope to further traverse the financial planning sector, referencing its ability to examine "the current cost, quality, safety and availability of financial services, products and capital for all end users".
Hockey said the inquiry's scope reflected "the Government's desire for a ‘root and branch' examination of the nation's financial system".
The Treasurer said the draft terms of reference would be subject to a two-week consultation period, with the final terms of reference being published in mid-December.
The Government wants the Review to provide an interim report by September next year, with a final report by November.
The release of the draft terms of reference was welcomed by the Financial Services Council (FSC), which described David Murray as the right man for the job at the right time.
FSC chief executive John Brogden said he was also pleased to note that superannuation would be a central part of the review.
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