The Federal Government's plan to launch a superannuation consumer advocate body requires more funding and a long-term commitment from the industry and political parties, according to consumer groups.
CHOICE and the Superannuation Consumers' Centre (SCC) welcomed Federal Treasurer Josh Frydenberg's $100,000 pledge on Budget night to establish the Superannuation Consumer Advocate (SCA), but highlighted shortcomings.
CHOICE chief executive Alan Kirkland said: "We will be calling for long-term and sufficient funding for a powerful advocacy body in the sector that is free from industry influence and annual budget cycle pressure."
The financial services Royal Commission highlighted the lack of consumer voices in superannuation advocacy and the need for consumers to be assisted through a complex superannuation system, he said.
Kirkland added Australia needs an independent consumer voice in the sector as superannuation industry groups have more than 100 staff - 20 of which are solely devoted to superannuation policy and research.
"Consumers need their own independent voice to combat these powerful industry influences."
The SCC received funding in 2018 as a result of penalties CBA and ANZ were forced to pay.
The banks paid a total of $2.5 million community benefits after ASIC found branch staff sold superannuation products to customers under the guise of general advice and not personal advice.
Frydenberg also allocated to the Superannuation Complaints Tribunal (SCT) $2.3 million over three years from 2020-21 to resolve outstanding complaints by 31 December 2020. By this date, the SCT will cease operations.
The cost will be offset by a corresponding increase in the Australian Prudential Regulation Authority Financial Institutions Supervisory Levies, he said.