Funds to be forced to offer no-frills superannuation
The Cooper review of superannuation commissioned by the Federal Government, is expected to recommend that all superannuation funds be forced to offer a “MySuper” product that offers no real investment choice, limited flexibility and reduced levels of disclosure, but with much lower fees.
Jennifer Hewett reports this in The Australian, saying that the review has backed off its earlier plan to establish a separate universal default superannuation fund choice for those with modest super accounts.
“It..(the low cost low frills option).. is designed to cater to the large number of Australians who would prefer to delegate the task of designing and maintaining an investment strategy for their super to someone else,” the review’s discussion paper states.
The MySuper proposal is similar to the very popular default investment option already offered by many super funds, especially the industry funds, which currently attract 80% of super members.
However the Cooper review found that some of these had inconsistencies which would have to be changed to comply with new MySuper rules.
The Cooper review is due to report to the Government by 30 June.
