Federal Treasury and the country's regulators will form a panel to oversee the Government's response to a Parliamentary Joint Committee (PJC) report on the Trio Capital collapse and Richard St. John's report on financial services compensation arrangements.
The Australian Prudential Regulation Authority, the Australian Securities and Investment Commission and the Australian Taxation Office will form a Superannuation Regulators Working Group with Treasury to ensure the implementation of he Government's response, strengthen communication and strengthen the regulatory framework.
The Minister for Finance and Superannuation, Bill Shorten, said the Government agreed with the majority of the findings, including improving the communication of risks to investors and strengthening professional indemnity insurance for retail financial services providers.
Shorten said the Trio report had prompted the Government to refer investment fraud, including in the superannuation industry, to the Heads of Commonwealth Operational Law Enforcement Agencies (HOCOLEA), which includes the Australian Federal Police, the Australian Crime Commission and the Attorney General's Department.
He said the Government accepted there was no recommendation for a last-resort compensation pool for investors, and acknowledged the cost borne by the industry with regard to current regulatory burdens. Shorten said, however, that the issue might be revisited in the future.
"In the meantime, the Government encourages professional bodies to themselves consider possible solutions to the issue of under-compensation, such as the implementation of their own scheme which further protects retail clients in the event of a member's insolvency," Shorten said.
Amid a challenging market environment, three super fund CIOs have warned against ‘jumping at shadows’.
The professional body is calling for the annual performance test to transition to a two-metric test, so it better aligns with the overarching duty of super fund trustees to act in the best financial interests of their members.
AustralianSuper, Rest, and HESTA agree on the need to retain and enhance the test, yet they differ in their perspectives on the specific areas that warrant further refinement.
Australia’s second-largest super fund has confirmed it is expanding its presence in the UK following significant investment in the region.
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