The main industry bodies representing both super fund trustees and funds managers will today get another opportunity to state their case against the idea of having a universal default retirement fund.
Fiona Reynolds, the chief executive of AIST, John O’Shaughnessy, deputy chief executive of IFSA, and Andrea Slattery, chief executive of SPAA, will address the annual ACSA/Investment & Technology conference in Sydney later today on what they would like to come out of the government inquiries – including the Cooper Inquiry into Superannuation – and what they think is most likely.
Four associations – AIST, IFSA, ASFA and the Corporate Super Association – sent a joint letter to Cooper last week specifically criticising the universal retirement fund proposal.
The letter warned that the proposed low-cost fund, for members who do not make a choice about their retirement savings, was likely to actually add to member costs.
Funds which offer retirement income products at the moment, which is an increasing array of large funds, would likely have to establish a separate structure to provide for “universal” members.
The letter said this would inevitably increase the administrative burden on the total fund, which would translate into higher, not lower, costs per member.
Cooper was quoted in the Australian Financial Review yesterday as saying he would not back away from the proposal. However, he said: “We need to go through some of the details and iron them out.”
Today’s conference will also hear from the AIST, IFSA and SPAA representatives on their views of the likely consequences of the Henry Inquiry into taxation, and the fallout from the Ripoll Inquiry last year into financial planning commissions resulting from the Storm Financial collapse.
A total of 308 attendees had registered for the conference late yesterday. This compares with about 250 registrants last year.
It is being held from 9am today at the Sofitel Wentworth Hotel.