BT Financial Group head of superannuation Melanie Evans said, if implemented, the recommendations would result in a more transparent and competitive superannuation system.  

“The Productivity Commission’s findings have highlighted the opportunities for change and we welcome its recommendations. Empowering employers to choose any MySuper fund as their employees’ default superannuation fund is a sensible approach and one that will encourage greater competition,” Ms Evans said. 

“MySuper funds must comply with a strict set of rules and therefore it is appropriate to allow employers to make a choice based on their employees’ needs if they wish to.  Previously, employers covered by an award were limited to whichever funds were listed in that award. 

“For those employers who don’t wish to make a choice, we also welcome the recommendation to base the selection process for default funds in modern awards on a fund’s compliance with the MySuper regime. This is an endorsement of the Government’s key superannuation reform, MySuper. 

“A tighter process in the selection and ongoing assessment of funds listed in awards is prudent and will improve competition, leading to better outcomes for Australian workers. 

“Australians deserve a superannuation system that gives the best chance to maximise savings. The Productivity Commission’s recommendations would deliver greater competition and therefore higher retirement savings for working Australians.”

3 July 2012

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BT Financial Group head of superannuation Melanie Evans said for the superannuation system to deliver higher retirement savings, Australians needed a more open and competitive market. 

“We welcome the fact that the Government has delivered on its promise to ensure the Productivity Commission conducts this inquiry. 

“Australia’s superannuation pool will double from $1.4 trillion to $2.8 trillion within 10 years. It’s essential we get the system right. There is no margin for error on such an important issue.” 

The current system excludes certain funds from being available as the default superannuation fund inside modern awards, Ms Evans said. 

“We believe this needs to be changed. There is also a need to introduce greater transparency around the ongoing performance of funds listed inside modern awards. 

“Australians deserve a superannuation and retirement system that gives the best chance to maximise savings. We are hopeful the inquiry will help deliver greater competition and therefore higher retirement savings for working Australians.”

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BT Financial Group’s Head of Superannuation & Platforms, Melanie Evans, said the Cooper Review findings announced last year recommended a framework that may have led to a “one-size fits all” approach to superannuation. 

“The Government’s announcement today has recognised the need for flexibility in super. In a compulsory system which at its core should be tasked with maximising the retirement savings of every Australian worker, it’s imperative there are a range of solutions to meet a wide range of needs. 

“Superannuation is currently $1.3 trillion and is expected to more than double to $3 trillion by 2020. With those numbers, it’s essential we get these far-reaching reforms right. After a number of reviews and a lengthy and deep consultation process between industry and Government, we’re pleased there is clarity about the future of Australia’s superannuation system.” 

Simple and efficient system
BT Financial Group has long advocated for a system that is easier for Australians to understand and engage with. 

“Our view has always been that the simpler the system, the more likely Australians are to take an active interest in their retirement savings. We’ve also invested a lot in helping Australians find their lost super and consolidating their accounts. 

“Too many Australian lose tens of thousands of dollars over a life time in unnecessary fees and charges through having multiple accounts. Anything that can be done to make this less likely will have an immediate and positive impact on the average working Australian’s super balance,” Ms Evans said. 

“We also welcome the Government’s acknowledgement that employees of organisations which transition to an electronic and low-cost way of administering super contributions will benefit from lower admin fees.”

Investment for life stages
Ms Evans said the Government’s announcement reflected the responsibility of funds to appropriately manage investment risk over a member’s lifetime. 

“It’s not appropriate for any Australian to have the same asset allocation and risk profile from the time they enter the workforce to the time they leave it. That’s why we have life stage funds as the default in BT Super for Life. 

“We’ve long been advocates for life stage investing and in recent times have noted the increased interest of investors in our life stage funds.” 

Governance
Ms Evans said the Government’s focus on governance was particularly reassuring. 

“We support the move of clearly setting out the duties and obligations of trustees. Superannuation is a fundamental part of the Australian economy and governance is a fundamental way to protect consumers. Improvements to governance are critical to the ongoing confidence of Australians in their superannuation.

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