The Superannuation Consumers’ Centre (SCC) has received a $2.5 million funding boost, which will allow the not-for-profit organisation to finally become fully functional after two decades of discussion. The development has been described by the SCC as a "victory for consumers".
The funding injection is the result of regulatory action against ANZ and the Commonwealth Bank over mis-selling of superannuation products.
Both banks accepted enforceable undertakings from the corporate watchdog, ASIC, to make a $1.25 million community benefit payment in addition to amend their sale practices.
It’s a fitting development, SCC chairman Rod Stowe said.
“This is an excellent example of the way enforceable undertakings can improve consumer outcomes. ASIC has ensured that the banks change their behaviour and consumers win through funding for a specialist organisation that will advocate for industry reforms to stop this kind of behaviour in the future,” he said.
“This funding will allow the Superannuation Consumers’ Centre to fund expert staff to represent and champion the interests of consumers in superannuation for the first time.”
The SCC has been under discussion for the last 20 years, with inquiries, reports and experts all agreeing on the need for a consumer advocate body.
“There are already specialist consumer groups in the health, energy and telecommunications markets. Given that the superannuation sector is now worth over $2 trillion a year, a specialist consumer organisation in this space is long overdue,” SCC board member Jenni Mack said.
However, its development stumbled after the industry was unable to match the government’s agreed $10 million contribution in 2012.
Now ready to operate, the SCC has four aims:
1. To reduce consumer anxiety and confusion when using the super system;
2. Increase consumer engagement to ensure people are making the most of their super;
3. Improve the economic security of Australian retirees; and
4. Improve retirees’ standard of living.
“This funding will allow the SCC to help individuals navigate the superannuation system by arming them with clear information and assisting on cases while also championing reform, particularly reform that will leave middle and low income Australians with more money in retirement,” Ms Mack commented.
“There are currently over 30 associations and bodies representing the industry interest but no specialist body to represent the authentic interests of consumers in this complex and deeply important market.”