The Financial Planning Association (FPA) supports today’s response by the Federal Government to the Cooper Report Recommendations, but reinforces that an increased take-up of professional advice is the most effective way to achieve better superannuation outcomes.

Assistant Treasurer and Financial Services Minister Bill Shorten today released ‘Stronger Super” the Government’s response to the Cooper Report into Australia’s Superannuation system review.

FPA CEO Mark Rantall said: “The FPA participated extensively in the three-phase Cooper review process and since the release of the report, we have worked closely with government in reviewing the recommendations to reinforce the role and the benefit of professional advice for all Australians.”

“Today’s announcement alone will not provide retirement adequacy for Australians. Government need to look at the whole package and this includes access to professional financial advice, along with consumer education and awareness, will make the real difference in increasing Australian’s superannuation and retirement benefits,” Mr Rantall said.

For example, the benefits highlighted in the Stronger Super package case studies are expected to deliver a retirement benefit boost of around $40,000 for an average worker aged 30 years today. This is an improved result but still falls well short of delivering what is needed for an adequate retirement. If however the average worker was to seek advice from a financial planner then according to the value of advice research conducted by Rice Warner they could boost their wealth by additional $100,000. Financial advice and increased superannuation contributions are critical in ensuring Australians’ financial independence.

Mr Rantall also welcomed the reforms for Self Managed Super Funds (SMSF) saying they emphasise the importance of advice. Especially the requirement for SMSF Auditor independence and the development of knowledge and competency requirements for SMSF service providers, stating that SMSFs that engage service providers should expect that they are appropriately trained and qualified to provide that service.

The FPA looks forward to continuing to assist the government in the ‘next steps’ process via the various working groups to be established as part of implementation of the Stronger Super reforms.

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AMP Chief Executive Officer Craig Dunn applauded the Government for taking a highly constructive and forward thinking approach to public policy with the thorough and consultative process of the Cooper Review.

“The recommendations outlined in the Cooper Report aim to strengthen the efficiency and effectiveness of the superannuation system and boost retirement adequacy for low to middle income earners,” said Mr Dunn.

“While the final Government policy is yet to be developed, AMP welcomes practical initiatives that mean more Australians can look forward to a comfortable and secure retirement.

“AMP supports the principle of MySuper and we are well positioned to offer customers a MySuper option with the recent launch of AMP Flexible Super Core,” he said.

AMP looks forward to working with the Government and the financial services industry to assess the implications of the recommendations and develop the detailed policy outcomes.

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