“And I suppose the icing on the cake, you know, really achieving excellence – and perhaps, topping the charts, as it were – you’ll all be aware, recently, that the Melbourne Mercer [global] pension index came out. It’s a sort of a ranking of all the systems around the world. We came second.

“What could really make us come first would be getting into the retirement income area. Looking at how we spend down in our increased lives; how we actually spend down the money, rather than just what we currently have, where we sort of hand back to [the] worker who’s reached retirement – we hand back to the worker a lump sum and effectively say, ‘Okay you can be Warren Buffett now and take this out and see how you go’. That’s being a little bit flippant, but yeah, I think that’s the real icing on the cake.”

The role that self-managed super funds play in helping a large number of Australians achieve adequate retirement incomes cannot be overlooked, but even in this area there are things that can be done to improve efficiency, and which should be looked at as part of the adequacy debate.

Gruen says SMSFs “are important”, but they’re simply an alternative vehicle for accumulating retirement savings and should not be immune from the drive to improve efficiency.

Gruen says: “SMSFs have a requirement in them to do an audit every year. The audit is based – it’s simplified, but it’s based – on the same audit you do of trustees of billion-dollar funds, and as a consequence it costs about $2500 minimum.

“That’s completely absurd. We could do that through the tax system. There are rules about sole purpose and all that sort of stuff that should be enforced. But the idea of getting $2500 of auditing done on this fund, year after year, is absurd and the Senate Committee in 2007 had a proposal that if you had passed your audit for the previous three years, you could be forgiven it for the next two or three. This would save serious money.

“It’s a simple piece of regulatory review that the Government can do, and everyone can do, and everyone will thank them for it. Why not do it?”

Shorten says that controlling costs is an integral part of the Government’s plan to raise the SG. It is not prepared to allow the industry to get fat off people’s compulsory contributions by being inefficient, or greedy. Developments such as SuperStream and MySuper are part of the overall package.

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