CFS urges fix for 15-year-old super choice failing

Colonial First State (CFS) has harked back to 2001 and the election of the Howard Government to suggest that the Coalition fell short on choice of superannuation fund and should take the opportunity to fix the problem this year.

In one of the final submissions filed with the Senate Economics Legislation Committee dealing with the Government’s Treasury Laws Amendment (You Superannuation, You Choice) Bill 2019, CFS pointed to the original Choice of Fund legislation being introduced in 2005 under then Treasurer, Peter Costello.

However, it suggested that the 2005 approach had never gone far enough.

“At the time, however, Choice of Fund was not extended broadly enough and many employees whose enterprise agreement or workplace determination specifies a superannuation fund still do not have the right to choose their own super fund,” it said.

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The CFS submission then suggested that the Government’s Protecting Your Super Package of reforms had already begun to improve efficiency in the system by removing multiple and duplicate member accounts.

“It follows that for the Protecting Your Super reforms to be able to operate with optimal effect other barriers, such as the denial of choice of fund, must also be removed,” it said.

The submission said that CFS believed that the passage of the bill into legislation was “critical to achieve the necessary member-focused reforms initially envisaged by the Choice of Fund model and “which are complementary to the improvements to the system proposed by the Productivity Commission in its recent assessment”.