The drive for superannuati on reform has shifted gears: new polici es have been committ ed to, and the gritt y work of imp lementati on is under way. It’s essential that the Stronger Super panel, set up to advise the Government on making MySuper, SuperStream and better trustee governance a reality, achieves consensus in this crucial stage. Can this be done? And what do these far-reaching changes, in addition to the forces of consolidation at play, mean for the future of the peak bodies representing the industry? SIMON MUMME and PHILIPPA YELLAND report.
Not since the onset of compulsory superannuation has so much been at stake for the industry. This year, the Government and industry campaign for mandatory 12 per cent super contributions will succeed or break down amid bipartisan disputes, and Jeremy Cooper’s vision for default super and a modernised administration of the industry will be inked into black-letter law. Meanwhile, as funds grow, the trustee governance structures overseeing this $1.3 trillion pool of members’ money will tested. There is clearly much to be fought for, and much to be defended. The centre of gravity in the reform agenda is the Stronger Super panel, led by the former chief of the $71 billion Future Fund, Paul Costello, and featuring the heads of key industry organisations: the Australian Institute of Superannuation Trustees (AIST), the Financial Services Council (FSC), the Association of Superannuation Funds of Australia (ASFA) and the Industry Super Network (ISN), among others. This group has been tasked with reaching consensus on a plan to implement the key reforms of MySuper — which is, essentially, shorthand for the default super structure – and SuperStream. It will be representing the interests of their constituents, be they trustees or superannuation executives, and by extension, the members of their funds.
But it’s not just the structure of the industry that is in the grip of change: the peak bodies representing its interests are also adapting to this new world. A current case in point is AIST. The association, which has until now concentrated exclusively on trustees in not-for-profit super, is responding to the evolution of the industry by adopting a broader focus. In 2010, the association undertook some introspection, and questioned how it would survive as the population of its traditional member, the not-for-profit super trustee, declined as funds continued to consolidate. AIST faced some tough questions. Foremost among them was: How could it maintain its mission as its member base shrunk? Should it seek scale through a merger? In the end, the industry itself provided the answer. AIST hired an independent consultant, Invisible Hand Consulting, to interview 30 people the association believed to wield considerable influence in the industry. They were asked for their opinions about AIST’s work, its strengths and weaknesses, and what its future should be. Their answers were kept anonymous.