The move by superannuation funds to charge for building a trustee financial contingency reserve is a “retrograde step”, according to Senator Jane Hume.
Addressing the Australian Financial Review Super and Wealth summit in Sydney, Hume, minister for superannuation, financial services and the digital economy, said several super funds had applied to the courts for this permission.
Charging members’ extra fees at a time when Your Future, Your Super reforms were about lowering fees meant the decision was a retrograde step.
“Let’s not kid ourselves as to what this really is; taking member’s money out of their retirement savings to set up a pool of funds – owned by the trustee – to ensure they can pay for penalties due to their own misconduct.
“If it appears that trustees are confusing their own interests – saving their own skins – with the best financial interests of members whose money is unlikely to be imperiled by a change of trustee, I would expect regulators to take action and Parliament might too.
“I’m not sure how many members would vote to give away some of their hard-earned retirement savings to bail out a trustee for wrongdoing.
“Particularly when trustees and those organisations that stand behind them have their own resources which they could alternatively draw on rather than milking their members.”
She urged superannuation trustees to raise the question with their super funds at the next annual members’ meeting.