Aware Super seeks Treasury approval for ‘health check’ nudges

Aware Super is in discussion with Treasury as to how it can broaden its scope of member advice beyond the provision of intra-fund advice.

Super funds are being encouraged by the Minister for Financial Services Stephen Jones to provide financial advice to their members as part of the government’s response to the Quality of Advice Review and further details were included in the first tranche of consultation under Delivering Better Financial Outcomes Bill.

Speaking at the ASFA conference in Adelaide, Jo Brennan, chief operating officer at Aware Super, said: “The boundaries of intra-fund advice are limiting and this is something we are trying to consult with Treasury on in the Delivering Better Financial Outcomes reforms. How do you get the cost down of producing advice?

“We are strong advocates of a slight expansion of what you can do under a collective charging model, which is absolutely affordable for members and, for some members, it will be the only piece of advice they get in their lifetime. For us, the extension of that is including a couple or a household and having a conversation about their Centrelink and the age pension entitlement, diverging slightly away from only their interest in the fund as we find that limiting.

VIEW ALL

View all

“This will dial up the volume of people we are able to help in a cost-effective way.”

She said the fund’s digital advice offering My Retirement Planner has already received over 28,000 users since July and has produced over 11,000 statements of advice (SOA). 

“This is complemented by a conversation with a human, there is complexity within the segments as advice is not one size fits all, but we are looking at how we can expand affordable help to be scalable and to provide personalised answers in a cheaper way,” Brennan said.

She also discussed who would be providing this advice, echoing comments from Jones that there should be an education pathway for advisers at super funds to progress to being a full adviser as a way to boost adviser numbers.

“We are strong advocates for broadening it out and allowing non-relevant providers. The super fund can create a super advice framework, we take full accountability, there is a minimum education requirement, and you put a boundary on what they can talk about,” Brennan said.

“In most cases, they will probably be using a digital tool that has most smarts in it to a member, but is a fully personalised answer.”

She also discussed the idea of providing personalised nudges in the same way as banks as this would incentivise people to take greater control of their super account. 

“I would love to be able to provide personalised nudges to our members, we are storing this data and would love to put it to good use and help people set up a preventive plan to enable them to have a better lifestyle in retirement,” Brennan said.

“The only way we will be able to have that effect is via these nudges to give people a health check and to dial up the personalisation on offer.”

However, she said clarity is needed in order for funds to avoid breaching strict anti-hawking provisions. 

On 4 November, the Treasury announced a consultation into how super funds can help members with their retirement including development of retirement and lifetime income products.