Industry superannuation funds may have made a solid push into Australia’s retail financial services space, however the sector’s advice proposition is underdeveloped, an industry principal has said.
“The proposition of retirement is pretty weak. The entire proposition is underdeveloped, the products are not really there, the services are not really there, the financial planning is not really there,” Tria Investment Partners managing partner Andrew Baker said.
“Many industry funds don’t even know their fund has an allocated pension. In the minds of most members in the feedback that we’ve had, retail brands are much better positioned than industry funds.”
Baker said while the more commercial industry funds are actively looking at how they can interact with the retail industry, a number of funds will find it difficult, particularly in light of government policy and changes to the superannuation regime.
“Changes in government policy that erode the attractiveness of super is a disaster for industry funds, because they thrive on an environment where super is the whole solution,” he told delegates at last week’s 9th Annual Wraps, Platforms and Masterfunds conference.
“Anything that comes out of Henry [Henry Tax Review] which changes the playing field towards non-super is a big problem.”
Baker said if industry funds want to supply advice services to their members, a number of funds will either need to build a new offering or buy into an existing offer.
“Some of the smaller funds already have some arrangements that they are happy with, like the Catholic fund for example, so I think there is huge opportunity for the financial planning industry to essentially try and collaborate on business models that will work for them and for industry funds,” he said.
“I think at least some of those will be happily working with the financial planning industry and some of them will be plugged into adviser desktops and some of them will be happily sharing their data. Some of them will make that transition.”
