Transparency urged on MySuper selection process

default-funds/association-of-superannuation-funds/ASFA/superannuation-funds/federal-government/

10 December 2012
| By Staff |
image
image
expand image

The Federal Government needs to ensure transparency in the process around the selection of default funds under modern awards with superannuation funds being given the right to state their case, according to the Association of Superannuation Funds of Australia (ASFA).

In a submission to a Senate Committee released last week, ASFA has made clear that it sees transparency as being vital to the workings of the Fair Work Commission (FWC) around the selection of default funds from a range of MySuper products.

As well, it has stated that funds should be selected on a net investment performance benchmark with appropriate recognition given to administration, advice and investment fees as well as to the appropriateness of the insurance offering

And while the industry funds have made much about past performance, the ASFA submission said that while past performance was relevant, it "should not necessarily be a deciding factor in assessing the ability to meet a specified net investment performance benchmark".

"Some or even many MySuper products will in effect be new products and will not have an investment return history as they will have different investment allocations and fees compared to previous products offered by the fund concerned," the submission said.

Dealing with the question of the need for transparency around the workings of the FWC, the submission said: "ASFA considers that the selection process for inclusion of a MySuper product in an Award as a default fund should be:

  • Open in that the provider of any generic MySuper product should be able to apply for inclusion.
  • Transparent in that all the criteria for selection should be explicitly made available to all applicants.
  • Fair in that the process used to determine which funds are included as a default in an award proceeds without any bias or potential bias and also allows applicants a right to be heard.
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 ago

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

2 months ago

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

4 months ago

Entireti has unveiled the new name for the AMP financial advice businesses that it acquired last year....

4 weeks 1 day ago

A Sydney financial adviser has been permanently banned from providing any financial services, with the regulator deriding his “lack of integrity, trustworthiness and prof...

3 weeks ago

Minister for Financial Services, Stephen Jones, has provided further information about the second tranche of the Delivering Better Financial Outcomes (DBFO) reforms....

1 week 6 days ago

TOP PERFORMING FUNDS