In a statement on Friday, the ISN (recently rebranded as Industry Super Australia, or ISA), announced its support for the new Fair Work Commission (FWC) process that allows all eligible MySuper funds to apply to be considered as one of the 15 funds that appear on a modern award.
ISA's comments came after the FWC outlined its current activities in an update on its website.
The commission is undertaking its 2013 review of modern awards to remove superannuation funds that do not offer a MySuper option by 1 January 2014.
The FWC is also gearing up to begin the first of its four-yearly reviews into default fund terms in modern awards “as soon as practicable after 1 January 2014”.
A draft timetable for the review of modern awards will be published on the FWC website in the coming weeks.
An 'expert panel' of seven members of the FWC will oversee the review.
ISA chief executive David Whiteley said the process for the selection of default funds on modern awards must use objective criteria – “the most measurable of which is long-term net returns”.
But according to the FWC, as well as net returns it will also consider the appropriateness of the product's investment return target and risk profile; its expected ability to deliver on the product's return target; fees and costs; governance practices; administrative efficiency and quality of advice.
Material included in the reviews of default terms will be made available on the FWC website – including statements, decisions, submissions, timeframes and transcripts of public consultations.
“Under [the FWC] process, every fund has the opportunity to provide written and verbal submissions to promote their fund. These submissions will be on the public record – the hallmark of a transparent process in the public interest,” said Mr Whiteley.
“From this process, up to 15 funds will be selected, providing employers with confidence in the shortlist and a manageable number from which to make their selection,” he said.
He pointed out that employers have “consistently resisted having to choose the super fund for their employees, not necessarily having the time or expertise, nor wanting the responsibility”.
“If employees wish to select their own super fund, they can continue to elect to do so,” said the ISA statement.
