New Minister for Financial Services Daniel Mulino will push ahead with minimum member service standards in the superannuation industry.

Mulino tells Investment Magazine in an exclusive interview that the $4 trillion super sector is “living up to the promise” of the foundational principles hatched at the 1983 Accords but would benefit from standardised customer protocols akin to those that exist in comparable industries.

“Much as we would see the regulatory system requires certain standards to be met when it comes to banks or insurers, I think it’s sensible to do the same here with superannuation,” Mulino says.

“So, I’m in the process of looking at consulting on particular service standards with the sector, and more broadly, and with a view to ultimately putting in place legislation or regulations there.”

The comments are the first confirmation since the historic May election that the Albanese government intends to make good on its pledge to introduce minimum member standards in super.

While Treasurer Jim Chalmers and Mulino’s predecessor Stephen Jones announced the move in January, it was seen by some political observers as a cynical attempt to push super misconduct issues out of the mainstream press in the lead up to an election rather than a serious plank of the government’s go-forward policy platform.

The intervention followed a string of claims handling and member experience incidents – a number of which are before the courts, including civil litigation proceedings brought against Cbus and AustralianSuper by the corporate regulator.

Consumer activists including Super Consumers Australia, which is affiliated with Choice, have spearheaded a campaign for new minimum standards and/or a customer code, as well as calling for a broader review of group insurance settings.

‘Very complicated job’

Mulino says he attributes the operational and member experience failures in the sector mostly to its burgeoning size and acknowledged that life is getting harder for funds as they grow.

“The super system is now so big, $4 trillion roughly, but also some of the individual funds have become very large, with hundreds of billions of dollars of funds under management, millions of members,” he says. “So, it makes their job very complicated.”

The comments suggest a more sympathetic tone than his predecessor, who was an outspoken critic of what he saw as slow progress on retirement strategies and a culture of poor service, as evidenced by consumer research conducted by CoreData in partnership with Investment Magazine publisher Conexus Financial.

Mulino, who wrote his doctorate at Yale on the economics of an ageing population and published a book on Australia’s social safety net, outlines a vision for super as an integral part of the nation’s welfare system.

“When I talk to politicians and regulators from overseas, so many of them look to our system as one of the very best benchmarks,” he says.

“The superannuation system is critical in that it’s going to provide millions of Australians with more dignity in retirement, more income security, higher levels of income in retirement. So that’s going to take pressure off the public pension system in the future.”

But he says members need more advice and guidance for the system to reach its full potential as a world-class retirement system, confirming the Delivering Better Financial Outcomes legislation expanding advice within super and facilitating more member nudges was a high priority.

“The system is doing well, but we know that millions of Australians are at or nearing the retirement age, and that’s why issues like the access to additional guidance for some is going to be critically important, because that’s going to be so important at that retirement point to make sure that people are in accumulation or retirement as is appropriate,” he says.

Mulino will address the Retirement Leaders Summit, a joint initiative of Investment Magazine publisher Conexus Financial and The Conexus Institute*, at Old Parliament House in Canberra next week.

*The Conexus Institute is a not-for-profit think-tank philanthropically funded by Conexus Financial.