Fix regulators, not the law: AIST 08 April 2021
The proposed update to the best interests duty has sparked debate for stakeholders across superannuation, but a peak industry body has declared the law doesn’t need to change, regulators have held back on fully using their current powers.
One of the government’s proposals under the Your Future, Your Super reforms is an amendment to
Superannuation Industry Supervision Act (
SIS Act), which would change the best interests duty to specifically requiring trustees act in members’ “best financial interests”.
The draft bill has also proposed to reverse the evidential burden of proof, so it is up to trustees and directors to show they performed their duties in line with the best financial interests of beneficiaries, rather than requiring regulators to prove their guilt.
Bragg also queried whether there were too many organisations seeking to represent the superannuation industry.
Later, answering a query from
Super Review, Bragg said the current situation of half a dozen industry organisations seeking to represent the industry was “intolerable and unsustainable”.
When the question of how many associations were active in seeking to represent the superannuation industry, the AMP represents acknowledged that “some consolidation would be sensible”.
The committee hearing heard from the Financial Services Council (FSC) that in terms of the proposed new legislative arrangements around members’ best financial interests, it was possible that superannuation funds could be challenged on whether their membership of particular industry associations was delivering members value for money.
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