The Australian Institute of Superannuation Trustees (AIST) has accused successive governments of providing “dozens of regulatory carve-outs and concessions to products, benefitting banks and other retail super providers over more than a decade”, based in their latest research.
The report, authored by corporate governance expert, Professor Thomas Clarke, argued that regulatory carve-outs given to the retail super sector had resulted in “serious omissions and exemptions” that had impacted badly on members’ interests. AIST chief executive, Eva Scheerlinck, said that watering down consumer reforms “left [consumers] to fend for themselves”.
One government decision highlighted was a failure to improve disclosure and transparency in non-MySuper funds, with the AIST pointing to one decision not to extend best practice disclosure requirements for MySuper funds to other super products.
The report also pointed to legislative gaps in super reform that had led to a “systemic” lack of comparability of data in the super system. The AIST called on the Australian Prudential Regulation Authority (APRA) to publish comparative data to help consumers compare and choose super funds, and help regulators and stakeholder better understand the efficiency of the super system.
This is an issue that both Money Management and its sister publication, Super Review, are also campaigning to improve.
Clarke suggested that an “army of lobbyists” employed by financial institutions were responsible for governments going light on regulation.
“This panoply of self-interested exemption has arisen over time, incrementally and without any ostensible rationale other than to benefit providers,” he said. “The exemptions are systemic, on a vast scale, and have been occurring for decades.”