In a rare joint announcement, AustralianSuper and Australian Retirement Trust, have reacted to Financial Services Minister Daniel Mulino’s reforms on consumer protection and advice.
The two funds represent almost $800 billion in member funds.
Yesterday (19 August) Mulino announced a range of reforms around lead generation, anti-hawking provisions, financial advice and compensation, prompted by the collapse of Shield and First Guardian.
Super trustees will face greater accountability under a new remediation framework allowing ASIC to direct trustees to commence compensation processes where there is reasonable suspicion they have failed to meet their obligations.
Under the proposal, trustees would be required to compensate members for their full capital losses where obligations have been breached, while APRA will receive new powers to impose capital requirements on trustees offering higher-risk investment options.
AustralianSuper CEO, Paul Schroder, focused his approval on measures around financial advice as 2.5 million Australians are set to retire over the decade. The fund is Australia’s largest super funds with $430 billion in assets for 3.6 million members.
“We support the Government’s plan to strengthen consumer protections and make advice easier to get for millions of Australians,” he said.
“Members deserve the right help to make good financial decisions with one of their most important assets. People need more help and they need that help to be safe and reliable.”
His comments are timely given AustralianSuper recently announced a decision to expand its advice offering via personalised digital advice and greater retirement guidance access.
Mulino also announced a ‘new class of adviser’ will be able to provide advice for APRA-regulated superannuation funds.
Meanwhile, ART chief executive, Kathy Vincent, said: “Australians deserve access to retirement advice that is right for them, and I congratulate Minister Mulino and the Federal Government on the range of measures announced.
“These changes will contribute to a more confident and dignified retirement for millions of Australians. We look forward to seeing the detail of the draft legislation so industry stakeholders can have confidence about the path forward that is in the interests of fund members.”
ART has 2.4 million members representing $370 billion in assets.