Speaking at the 14th Annual Wraps, Platforms & Masterfunds conference in the Hunter Valley yesterday, Mr Hewson said a royal commission into funds management and super is the inquiry Australia “ought to have”.
“It will come, don't get me wrong, because we only need another couple of Storm Financials and you wait [and see] what happens as a political response to that,” Mr Hewson said.
The former Liberal leader has little time for the current Financial System Inquiry, which he said is being chaired by a “climate-denying banker” in former CBA boss David Murray.
“[David Murray] was instrumental in the process whereby the CBA saw itself as a funds manager and a financial planner and a bank,” Mr Hewson said.
He went on to predict that the big banks would soon rid themselves of their wealth management divisions.
“I suspect that there will be a push by the major banks to break down the process of owning [them] … and to move out of funds management, on-sell them,” Mr Hewson said.
“You can see circumstances where they would be better off not to be in that business than pretend that you are in that business. And equally in their financial planning business,” he said.
When it comes to superannuation, Mr Hewson said, there are “massive inequities” in terms of the impact of super contributions and super earnings.
“Tax in superannuation is quite inequitable in terms of the concessions tax,” he said.
“For example, if you're on $20,000 income it costs $118 to get a $100 benefit. Whereas if you're on $250,000 income it costs you $62.50 to get a $100 benefit,” Mr Hewson said.
“I think that's unsustainable even with the adjustment we just had for low-income super,” he added.
If the government attempts to make cost savings in future budgets, it won't be in the area of negative gearing or other concessions; it will be superannuation that will be targeted, Mr Hewson predicted.
