Industry funds will continue to dominate the default super market, thanks to Superannuation Minister Bill Shorten.
This is the assessment of Shorten’s opposite number, shadow Superannuation minister Mathias Corman, who has labelled the Fair Work Amendment Bill – which passed through parliament yesterday – as anti-competitive, conflicted and inappropriately favouring union dominated industry funds.
“In legislation passed by the Parliament today Bill Shorten has sought to protect the vested commercial interests of the union movement at the expense of the public interest,” said Cormann.
“Instead of putting the interests of one segment of the financial services sector first, he should have put the interests of Australians disengaged from their superannuation arrangements first.”
Cormann went on to attack Labor’s track record in the default super area.
“Julia Gillard as the then Minister put in place the current widely discredited closed shop and anti-competitive process by which default funds in modern awards are selected through Fair Work Australia,” he said.
“Even Labor had to finally recognise in the lead-up to the 2010 election that the process to select default funds under modern awards lacked credibility and promised to replace it with a more open, transparent and competitive process.”
Cormann has also pointed the finger at Shorten for his lack of enthusiasm in dealing with the issue, claiming that he was slow to act at first, and that now the legislation that he has delivered “falls way short of the promise of an open, transparent and competitive process for the selection of default funds under modern awards”.
“It is a continuation of a process where conflicted parties within Fair Work Australia will select default super funds under modern awards,” added Cormann.
“The government is currently also legislating to enshrine all the consumer protection requirements it judges are important for Australians who do not make active choices about their own super arrangements through their MySuper Bills.
“Given that is happening, surely any MySuper product should be adequate as a default product by virtue of its registration as a default product and be able to compete freely in the default fund market.
“There is absolutely no reason why every product which qualifies as a MySuper product should not be able to compete freely in the default fund market.”
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