The roundtable participants agree that transparency sits at the heart of providing advice in super and who is actually paying for it. This is the fifth part of a Super Review roundtable.
Mike Taylor, managing editor, Super Review: Paul, you were saying that you've got $880 advice fee?
Paul Cahill, CEO, ClubPlus: That's the full plan, the holistic approach
MT: That's the full plan?
MT: With less than holistic advice, are you..?
PC: Two hundred and twenty.
MT: Two hundred and twenty, but it's specifically charged to their account?
PC: Correct. It becomes debited straight out of their account.
MT: But there's a lot of criticism of funds where it's not so..?
MT: ...so transparently charged, and I wonder whether that's going to be a problem going forward. Do you think so, Leeanne?
Leeanne Turner, CEO, MTAA Super: Well, I think to a certain extent FOFA's done a bit about that but clearly there's a long way to go, and FOFA isn't as simple as it sounds either.
PC: But for us, we're lily white, transparent. Like we're not going to try going to the members [saying]"Yeah there's one percent down the back there that you didn't see in the first place." It's not how to go.
Industry funds, especially the ones that have a very poor dynamic about looking after its membership, like we do because we answer and live with them every day, we're not trying to game them out of an extra per cent.
Some of the problems with the advice business is - and I'm talking generically here -are that they have tried to game the system and they're seeing a falling-out now. Look at what people in Canberra are having to deal with. That's because people have just tried to use people's disengagement and lack of knowledge to their benefit and that's wrong. Industry funds like ourselves, we don't roll that way.
MT: Paul, do you have a view on how advice is charged for within a fund?
Paul Rohan, head of Sandhurst Trustees: I think transparency's the key, so as long as people know what they're for and when they're paying for it, that's the key. And documentation; and explanation has to go with that documentation, so people are crystal clear.
Andrew Creber, COO, JP Morgan Asset Management: Yeah, I agree. I mean again this goes back to members and how do you get people engaged to provide that transparency that they know that they have a full understanding of all the fees that are being charged? I mean it's only going to the benefit of the industry. I think we're getting there, but more can be done.