The Industry Super Network (ISN) has claimed that new legislation allowing a Fair Work Commission panel to make the call on approving default super products will create an “open and transparent default fund system”.
ISN CEO David Whitely said that the new legislation will ensure that default funds are selected on merit – and Australians’ retirement savings are largely protected.
“The Productivity Commission recognised that the default funds named in modern awards have generally outperformed other superannuation funds,” he said.
“The Government’s announcement places the interests of members ahead of others and establishes net returns as a primary consideration for the naming of default funds in modern awards.
“We welcome an open and transparent system where the listing of a default fund in an award is based on merit.”
He added that employers have argued for a system that doesn’t place the burden and cost of default fund selection upon themselves, and that therefore the announcement that a Fair Work Commission expert panel will undertake this process is welcome news.
“The assessment of funds by the Fair Work Commission according to a set of established criteria will ensure that all funds are considered on the same basis and will not place undue burden on employers to make their own judgements on such an important issue,” he said.
“The new default super process will help instil confidence in superannuation and underpin a working safety net that is critical to our compulsory superannuation system.”
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