ASIC to examine super fund and employer connections

ASIC confirmed it will look further into the links between superannuation funds and employers in 2019.

ASIC said one of its 2019 priorities is to examine the relationship between superannuation funds and employers, who assume great responsibility in Australia's retirement system.

As reported in The Australian late last year, ASIC will shine its regulatory light on how deals are struck between employers and super funds in Australia, after a year in which default superannuation arrangements were a point of focus.

According to the report, ASIC's investigation is set to examine how employers determine which fund manager should assume responsibility for protecting the retirement savings of workers who do not nominate a specific superannuation fund.

Last year, the Royal Commission heard of super funds incorrectly charging members for advice services they didn't use, and instances of fee rebates not being refunded to entitled superannuation members.

After difficult appearances at the Royal Commission, AMP lost a $250 million mandate to manage the Anglican National Super plan, which houses retirement savings for employees of the Anglican Diocese of Sydney.

ASIC's new investigation may draw upon a body of work being conducted in the area of employers and superannuation since 2016. The corporate regulator's 2018-22 corporate plan outlines its intent to continue reviewing the practices of superannuation trustees, including the provision of advice, fee-for-no-service, disclosure benefits and inducements, and third party service providers.

The document - released in August last year - also revealed ASIC will establish a dedicated superannuation team in its pursuit of addressing the growing importance of retirement issues.

In September last year Workplace Super Specialists Australia called for employer funds to be included in a best-in show list of recommended default funds proposed by the Productivity Commission.

WSSA said employer funds were entitled to be included as an 11th option on the list, because employer funds "are not just off-the-rack funds."

Read more: ASICRoyal CommissionWorkplace Super Specialists AustraliaSydneyProductivity CommissionWSSA
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