Labor MP Stephen Jones has seized on a statement made by Liberal senator Andrew Bragg as evidence that the government has failed to act on transparency around super fund administration fees. Mr Bragg told Sky News that action would be taken on all fees, apparently flying in the face of official communication from Treasury and Senator Hume that the reforms would only tackle investment fees.
“At least someone in the Liberal Party is willing to acknowledge that the government’s glossy budget announcement to change super has a gaping hole in it,” Mr Jones said.
“But the minister responsible, Jane Hume, remains in hiding, refusing to back her flawed performance benchmark. Perhaps she’s gone back to the drawing board?”
But a spokesperson for Senator Hume disputed Mr Jones’ comments, telling Investor Daily that the senator had been “extremely visible” and had spent much of her time since the release of the budget actively engaging with industry stakeholders to ensure the success of the reforms.
Mr Jones also cited Productivity Commission findings that Australians pay the second-highest administration fees in the world to super funds as evidence that more needed to be done, saying “the retirement savings of millions of Australians are at stake”.
“It is vital administration fees are made transparent to super fund members in any measurement of their funds’ performance,” Mr Jones said.
“Labor warned the government its failure to do so was a major design flaw in its plans. Senator Bragg knows this is true. If Assistant Minister Hume won’t consult with Labor or the industry to fix her botched budget announcement, she should at least take advice from her backbench colleague.”
Mr Jones has also warned that proposed performance benchmarks will discourage funds from investing in infrastructure and turn them back to the ASX 200 and other passive investments – a sentiment that Ms Hume, speaking to Investor Daily, strongly disagreed with.
“We know that super funds at the moment are already investing in infrastructure and alternative asset classes in order to create that alpha, that excess return, and they’re doing a really good job with it,” Ms Hume told Investor Daily.
“I don’t think that holding those funds to account for their performance is going to be a problem at all. In fact, I think that a lot of them would embrace that opportunity to be compared to those funds that aren’t really living up to those expectations.”
