With the future shape of Australia's superannuation industry under the microscope, the current review process has no place for the cult of personality, writes Mike Taylor.
Australia’s superannuation fund industry has expended many hours, and not a small amount of money, over the latter months of 2009 in formulating and presenting submissions to the Review into the Governance, Efficiency, Structure and Operation of Australia’s Superannuation System — the Cooper Review.
But those attending last month’s Association of Superannuation Funds of Australia (ASFA) conference in Melbourne and, indeed, a number of other fora addressed by the chairman of that review, Jeremy Cooper, may have been left wondering whether their efforts will prove justified.
To suggest that Cooper’s approach to chairing a major Government review is proving unconventional would seem an understatement. Cooper has not exhibited the studied silence and perceived independence usually associated with chairing an inquiry.
With just one phase of the review process complete in November, he was leaving ASFA delegates in no doubt about his thoughts regarding the ultimate outcome.
What is more, Cooper has exhibited no reluctance in quoting the trenchant views of industry commentators who have not even seen fit to make submissions to the inquiry.
The unease created by the Cooper approach is manifested in the transcript of the Super Review round table conducted during this year’s ASFA Conference. He would do well to consider the unease exhibited by a number of the participants.
While the media and some industry figures may have leapt upon the convenience and brevity of referring to the review of superannuation as “the Cooper Review”, that does not mean media coverage should focus on its chairman or unduly note his personal views.
Just as should be the case with every Government inquiry, Cooper and his fellow committee members owe the Government, the industry and tax payers a duty of fairness and objectivity.
Their own preconceptions must hold no greater weight than those of any other party filing a submission.
Cooper, having been appointed as chairman of a Commonwealth inquiry, is a servant of the people for its duration and should adhere to the precedents and conventions implicit in that role. If he finds that requires sublimation of his lawyer/regulator instincts, so be it.
Should Cooper need any guidance about the appropriate role and conduct of inquiry chairmanship, he need look no further than the chairman of the Parliamentary Joint Committee into Corporations and Financial Services, Bernie Ripoll.
Ripoll, as the chairman of a Parliamentary inquiry, was arguably entitled to more ambit than Cooper, but in all his public utterances he remained careful to canvass the issues without being seen to be trying to determine a particular outcome.
It was a measure of Ripoll’s astute handling of his chairmanship that few in the financial services industry were prepared to precisely predict the exact tenor of his committee recommendations.
They might have been able to guess at the thrust, but not the detail.
The minister for Financial Services, Superannuation and Corporate Law, Chris Bowen, should also stand as an example to Cooper. The minister, while seeking to drive necessary reforms in the sector, has been careful to avoid prescriptive and partisan positions.
Cooper, in his address to last month’s ASFA conference, made much of the possible future shape of the superannuation industry. He suggested there be fewer than 30 funds, the largest controlling $200 billion and the smallest controlling about $50 billion (allowing them to own assets outright).
He seemed greatly enamoured with the fact that a couple of Canadian pension funds had been able to bid for the assets of Transurban in Australia.
What Cooper described may, indeed, prove to be the shape of the Australian superannuation industry in 15 to 20 years’ time. However, it is a destination best achieved by evolution rather than Government-inspired revolution.
In the meantime, Cooper’s job should be to deliver on the terms of reference laid out for the current review. And nowhere in its brief has the Government suggested it wants the baby thrown out with the bathwater.