The Your Future, Your Super bill will move to the Senate after the Government dropped its controversial investment veto powers.
The veto powers would have allowed the Treasurer to ban any investment or expenditure by a super fund.
Eva Scheerlinck, Australian Institute of Superannuation Trustees (AIST) chief executive, said the veto provision was flawed and a case of unprecedented overreach, but the bill was still flawed.
“Providing governments with the power to veto super fund investments is in no one’s best interests and it’s a relief to see this provision scrapped,” Scheerlinck said.
“Removing this provision from the bill doesn’t remove the direct and immediate threat to millions of Australians who will be stapled to underperforming and untested super products.”
The AIST said the bill should not only be rejected, but it should be scrapped and begun again, and Australians were now relying on members of the Senate to protect their super savings against the bill.
“The amendments to the bill don’t change the fact that this piece of legislation contains fatal flaws that will result in significant unintended member detriment,” Scheerlinck said.
“This bill excludes more than one third of super savings from scrutiny and disclosure, and does not prevent members from being stapled to funds that have not been tested or have failed the test.”
Although the AIST said it supported the intent of the bill to improve super fund performance and reduce multiple accounts, it said it was crucial underperformance was addressed across all super products before any stapling begins, as recommended by the Productivity Commission.
Scheerlinck said addressing underperformance was only one of many changes that would now need to be made in the Senate to ensure members were not left worse off by this legislation.