Liberal Senator for South Australia Grant Chapman has hit out at those industry funds that criticised the parliamentary enquiry on the structure and operation of the superannuation industry.
Speaking at yesterday's SMSF Professionals' Association of Australia national conference in Sydney, Chapman said that criticism from industry funds over the enquiry was "unwarranted" and the results had been "very valuable".
"I point out that the Superannuation Industry Supervision Act has been in place for 13 years and with the ongoing and rapid changes that have occurred over that time, and the additional incentives provided in the last Federal Budget for people to save for their retirement through superannuation, it is timely and prudent to review its adequacy," he said.
One of the enquiry's biggest critics was the Australian Institute of Superannuation Trustees, which recently merged with the Conference of Major Superannuation Funds.
Its president Susan Ryan branded the enquiry as a fishing expedition, rather than a useful piece of work. She said at the time of its inception that it was a strange initiative that would unnecessarily revisit issues that were already under discussion.
Chapman, however, quoted statistics that suggested 65 per cent of respondents felt the enquiry into superannuation was warranted.
In his speech to delegates the Senator summed up the key findings of the enquiry and said the government was taking stock of the evidence before coming up with any recommendations.
He laid particular emphasis on the debate surrounding the provision of advice to consumers.
"This point goes to the heart of the role of advice in superannuation, which has emerged as a central issue to be considered by the committee during the inquiry . . . Without ongoing professional advice it is unlikely that a large percentage of Australians will achieve their retirement goals," Chapman said.
The enquiry found, he said, that the debate about advice should shift from the cost of advice to the value of advice.
Definitions of advice were found by the enquiry to be too broad and structures needed to be put in place by regulators to allow basic advice to be given to lower income earners at a reasonable cost.
Other issues thrown up by the enquiry included concerns over cost and fee transparency across the industry and the need for regularity clarity. The separate roles of APRA and ASIC also came under scrutiny, as did the cost burden of compliance.
The high profile advertising campaign by Industry Funds Services last year, encouraging people to join industry funds, was another issue widely discussed at the enquiry.
Many argued that imposing marketing expenses on current members primarily to attract new members was difficult to justify in light of the sole purpose test.
