Retirement
Proposed super reforms set to add $50k to your retirement
The government is being urged to ignore the “self-interest” of the superannuation funds and pass the Your Future, Your Super reforms to help members pocket an extra $50,000 in retirement.
Proposed super reforms set to add $50k to your retirement
The government is being urged to ignore the “self-interest” of the superannuation funds and pass the Your Future, Your Super reforms to help members pocket an extra $50,000 in retirement.
Super consumers are calling for the government to pass through the hotly debated changes to superannuation, highlighting the importance of shining a light on underperforming funds.
Xavier O’Halloran, director of Super Consumers Australia, said modelling from his organisation has shown that there are five super products that are not considered underperformers that would fail the proposed test if administration fees are included.
“This legislation is about making sure super funds act in the best interests of members. If it is going to deliver on this intent, it needs to apply performance tests to all products and apply scrutiny to administration fees. Lowering fees by just 0.5 per cent could see a typical person retire with an extra $55,000,” says Mr O’Halloran.
Under the You Future, Your Super reforms, duplicate accounts, which lead to duplicate fees for members, will also be removed.
The consumer advocacy group pointed out that failure to act will see another 850,000 duplicate accounts created this year. The industry’s failure to address these duplicates has seen a typical worker’s balance reduce by $51,000 in retirement.
“This legislation will finally free people from the scourge of duplicate accounts. Coupled with performance testing, super funds will face real repercussions if they fail to deliver good returns on people’s retirement savings,” Mr O’Halloran said.
Super consumers also highlighted some industry players have embarked on a “self-preservation mission”, failing to recognise the intersecting impact of each of the measures.
“This questionable framing from part of the industry assumes stapled funds will continue to underperform for an extended period of time. This ignores the positive impact the performance test will have in requiring dud funds to shape up or lose access to customers,” says Mr O’Halloran.
“The proposed Your Future, Your Super laws will help consumers, but can be made even stronger. The law currently leaves core obligations to the regulations and doesn’t apply scrutiny to administration fees and some super products.”
RELATED ARTICLES
About the author
About the author
Superannuation
Australia's super performance test transforms investing: What's the next move?
APRA’s latest performance test has done more than name and shame lagging super options; it has rewired investment strategy, compressed fees and accelerated consolidation across the $3Read more
Superannuation
Australia's super test dilemma reform could boost long-term gains while keeping accountability sharp
APRA’s latest performance test results have reignited a structural debate: can Australia hold funds to account while still backing the nation’s long-horizon investment needs? With the government ...Read more
Superannuation
Super funds rethink strategy as APRA's performance test hits a fork in the road
The latest performance test results have reignited debate over Australia’s superannuation benchmarking regime and prompted a formal government review. Behind the headlines, boards are quietly rewiring ...Read more
Superannuation
Aware Super enhances digital tools for financial advisers, boosting efficiency and client engagement
Aware Super has unveiled a suite of new digital features designed to streamline the workflow for financial advisers and their clients. This significant upgrade includes direct data feeds to Xplan and ...Read more
Superannuation
Super funds flip the script as APRA's performance test sparks strategic overhaul
Australia’s performance test has lifted the floor on retirement outcomes—and divided the industry in the process. After early shockwaves, failure rates have fallen and fees have trended down, but ...Read more
Superannuation
Rewiring Australia’s super performance test: from compliance brake to capital engine
Can an accountability tool double as a nation-building lever? Canberra’s review of the superannuation performance test aims to preserve member protection while freeing funds to back long-dated assets ...Read more
Superannuation
Superannuation guarantee rate rises to 12 per cent as parental leave changes take effect
The superannuation guarantee rate has increased from 11.5 per cent to 12 per cent from Tuesday, with super contributions also being added to Commonwealth Parental Leave Pay for the first time. Read more
Superannuation
Rest's Sustainable Growth option achieves highest sustainability classification
Rest superannuation fund has achieved the highest sustainability classification for its Sustainable Growth investment option from the Responsible Investment Association Australasia. Read more
Superannuation
Australia's super performance test transforms investing: What's the next move?
APRA’s latest performance test has done more than name and shame lagging super options; it has rewired investment strategy, compressed fees and accelerated consolidation across the $3Read more
Superannuation
Australia's super test dilemma reform could boost long-term gains while keeping accountability sharp
APRA’s latest performance test results have reignited a structural debate: can Australia hold funds to account while still backing the nation’s long-horizon investment needs? With the government ...Read more
Superannuation
Super funds rethink strategy as APRA's performance test hits a fork in the road
The latest performance test results have reignited debate over Australia’s superannuation benchmarking regime and prompted a formal government review. Behind the headlines, boards are quietly rewiring ...Read more
Superannuation
Aware Super enhances digital tools for financial advisers, boosting efficiency and client engagement
Aware Super has unveiled a suite of new digital features designed to streamline the workflow for financial advisers and their clients. This significant upgrade includes direct data feeds to Xplan and ...Read more
Superannuation
Super funds flip the script as APRA's performance test sparks strategic overhaul
Australia’s performance test has lifted the floor on retirement outcomes—and divided the industry in the process. After early shockwaves, failure rates have fallen and fees have trended down, but ...Read more
Superannuation
Rewiring Australia’s super performance test: from compliance brake to capital engine
Can an accountability tool double as a nation-building lever? Canberra’s review of the superannuation performance test aims to preserve member protection while freeing funds to back long-dated assets ...Read more
Superannuation
Superannuation guarantee rate rises to 12 per cent as parental leave changes take effect
The superannuation guarantee rate has increased from 11.5 per cent to 12 per cent from Tuesday, with super contributions also being added to Commonwealth Parental Leave Pay for the first time. Read more
Superannuation
Rest's Sustainable Growth option achieves highest sustainability classification
Rest superannuation fund has achieved the highest sustainability classification for its Sustainable Growth investment option from the Responsible Investment Association Australasia. Read more
