Bill Shorten has successfully put a stop to Productivity Commission moves towards genuine competition in the superannuation default fund market under this government.
This is Shadow Minister for Superannuation Mathias Cormann’s assessment following Shorten’s release of the final Productivity Commission report into default superannuation under modern awards today.
“Bill Shorten's bullying of the Commission at the behest of his friends in the union movement has been successful,” said Cormann, who added that the the current process for the selection of default funds under modern awards, initiated by this government and run by Fair Work Australia, is a “national disgrace”.
“It is an anti-competitive, closed shop arrangement, which lacks transparency, is littered with inherent conflicts and inappropriately favours union dominated industry super funds,” said Cormann.
“It took Bill Shorten forever to get around to asking the Productivity Commission to look at this important issue.
“Now that the final report is out, it is clear that as a result of Bill Shorten's unprecedented intervention two months ago, when he effectively responded to a Productivity Commission review before it had been finalised, he forced the Commission away from its previous recommendations to ensure genuine competition in the superannuation default fund market.
Claiming that genuine competition in the default fund market is critically important to ensure efficiencies and value for Australians in default super are maximised, Cormann has said that the Productivity Commission’s recommendations would now see the continuation of a process where conflicted parties within Fair Work Australia will continue to select default super funds under modern awards.
“The government is currently legislating all the consumer protection requirements it judges are important in a default fund product through its MySuper legislation,” said Cormann.
“Given that is happening now, 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.
“There is no justification for the additional cost and complexity which comes with an additional layer of government intervention in that market which the Productivity Commission appears to have embraced now under pressure from Minister Shorten.
“Bill Shorten has been so desperate to protect the vested interests of his friends in the union movement that he has lost sight of his responsibility as a Minister of the Crown to act in the public interest.
“Clearly this government will not do what needs to be done when it comes to ensuring that employers and employees in default super can benefit from genuine competition in that market.”
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