Trustees should adopt system-wide policies: Sherry
Monday, 17 November 2008 12:30pm
Superannuation minister Senator Nick Sherry urges trustees to adopt superannuation policies that will benefit the entire industry - dispelling the age-old notion that trustees only need to look after the welfare of their own members.
Senator Sherry told journalists at the ASFA conference on Friday that there needs to be a system-wide approach to improving the infrastructure behind super.
"We've got people trying to develop solutions for the same causes and problems," he said, referring to super funds investing time and money on improving their admin systems.
To that end, the Federal Government plans to introduce an optional superannuation clearing house system - effectively one single admin system where small businesses with less than 20 staff can offer their staff choice-of-fund without the related time and cost issues. The scheme stands to benefit more than 90 per cent of businesses in the country.
But the introduction of a national clearing house system is only one of many government measures that Senator Sherry hopes to implement during his tenure. He is also urging the industry to reduce the number of Lost Super accounts and help their fund members consolidate their super.
On last count, there are 31.7 million accounts for 11.4 million adults including 6.4 million accounts in ‘lost super'.
"For the last 20 years, we've been preoccupied with the debate on contributions and adequacy and that's legitimate. But in my view, we have not been focused enough on efficiencies in the system."
He said the inefficiencies in the way super operates, the costs and the complexities all add up to higher-than-warranted fees, all of which reduce the final amount that fund members receive when they retire.
Michelle Baltazar
