Speaking at an Association of Superannuation Funds of Australian (ASFA) luncheon in Sydney yesterday, chief executive Pauline Vamos said super funds need to start setting their own standards when it comes to regulation.
Referring to the latest draft of Regulatory Guide (RG) 97 Disclosing fees and costs in PDSs and periodic statements, which is currently undergoing targeted consultation, Ms Vamos said ASIC initially gave the industry three days to look at it.
“We all banded together and said ‘We need a bit more time’,” she said.
“There’s obviously significant issues with disclosure of indirect costs and fees. As well as direct [fees]. The methodology has changed, [and] it has not been able to be tested.
“I’m the first one to whinge about ASIC, but can I say: we have not been helpful,” she said.
When the consultation process around RG 97 began ASFA spoke to ASIC deputy chairman Peter Kell and commissioner Greg Tanzer, Ms Vamos said.
“They said: 'Pauline, just corral the industry. If you give us one view and you guys really show us that you can nail this and get this right, we’re there'. That did not happen,” she said.
“And every time there was a consultation other interested bodies gathered around, and nobody agreed.
“So we’ve ended up with this regulatory guide that nobody understands, and it’s not effective, and it would cost so much to implement that we would go way back in time in terms of our ability to reduce costs and have that transparency to members,” Ms Vamos said.
A recent ASFA board strategy day put fee disclosure on an equal billing with tax when it came to importance, she added.
“One [example] I’ve been harping on for years about is the disclosure of insurance premiums in the PDS. Whether it’s the age last birthday or the age next birthday – just pick one, I don’t care, let’s do it,” Ms Vamos said.
“And until we do that, we’ll be paying for people at ASIC to sit there for hours and hours on end consulting to an industry – we all have to pay for that – and that goes out of our members’ accounts.
“And that’s where we’ve got to start raising our own standards,” Ms Vamos said.
