MySuper is in danger of becoming a "housing commission" product if advice becomes unaffordable for many people, according to AllianceBernstein chief executive Michael Bargholz.
"We need to ensure that the interests of members come first. MySuper could become a housing commission product if people cannot afford the advice to accompany it," Bargholz said during a panel discussion at the Conference of Major Superannuation Funds on the Gold Coast yesterday.
"We have won the battle with fees and commissions but we are losing the war on advice."
Bargholz said MySuper could disengage people from seeking advice.
HESTA chief executive Anne-Marie Corboy, however, said not everyone needed the traditional holistic financial advice currently offered in the market.
"Not everyone has $500 million accounts that they want to grow. The delivery of advice takes on many paths," Corboy said.
"An initiative like intra-fund advice can provide single issue advice for the vast majority of people who need advice on specific issues."
Allowing MySuper to offer intra-fund advice would in part help people engage better with their superannuation, according to a number of the panel members.
"Intra-fund advice in MySuper would then make MySuper the antithesis to a housing commission product," Australian Council of Trade Unions assistant secretary Tim Lyons said.
It would make it "sustainable" as it would provide people with the option of some level of advice, he said.
Industry Super Network chief executive David Whiteley quoted research from Deloitte that found that it would cost a person $10 a year to get intra-fund advice from a medium-sized superannuation fund.
"Intra-fund advice is not conflicted advice. It is important that MySuper be able to offer this sort of advice for a person's single most important investment in their life, which is their superannuation," Whiteley said.
Corboy said intra-fund advice was an important part of service delivery for members.
Financial advice as a product and as an industry would also continue to evolve, according to the panel.
"If fee-for-service is the end for some financial planners, then that is good news. If a financial planner can't add value and show that they are adding value through a fee-for-service model, then they should leave the industry," Bargholz said.
Whiteley said the delivery of advice would move increasingly to the web and through call centres.
"Advice will continue to evolve. There could even be more jobs created, for example, in software development if there is more take up of advice on the web," he said.
Concerns were also raised regarding the Greens' decision not to back the company tax cuts associated with the Mineral Rent Resource Tax, a move that could jeopardise the Labor government's proposed increase in the superannuation guarantee (SG) from 9 per cent to 12 per cent.
"The mining tax is part and parcel of the government's reform process. Increasing the superannuation guarantee means a cut in the company tax rate," Australian Institute of Superannuation Trustees chief executive Fiona Reynolds said.
"Already major employers are not supporting the 12 per cent SG. If employers do not get this tax cut, it will only bring greater uncertainty."
