Despite the recent improvement in performance of super funds older Australians still feel let down and are calling on the Cooper Review of superannuation to take action.
National Seniors, the nation's peak body for older Australians, has this week submitted its response to the Cooper Review's preliminary reports.
Commenting on the submission, National Seniors chief executive Michael O'Neill said: "Improved performance since the end of the global financial crisis is too little too late for many seniors. Retirees and people close to retirement will never be able to get back the super they lost."
"The problems the global financial crisis exposed in the super system have not gone away. There is still a lack of effective competition, regulatory oversight and governance.
"Seniors are concerned that in response to the Cooper Review's preliminary reports, some sections of the super industry are opposing reform and adopting an 'if it isn't
broke don't fix it' approach. Our submission makes it clear that the system is broken.
The submission highlights problems, such as:
- excessive and confusing fees and charges
- poor communications with members, especially in long and complex disclosure documents
short-term approach to performance.
"We also set out how these problems can be solved. The industry needs to adopt a life-course approach to retirement savings, best practice in communicating with members, introduce transparent fees and help to improve the financial literacy of super fund members," said O'Neill.
MySuper Older Australians believe the MySuper proposals revealed by the Cooper Review are a step in the right direction for the country's superannuation system.
MySuper will offer superfund members a default product with reduced fees. The proposals also make it clear that Trustee duties are focused entirely on looking after
Commenting on the proposals Michael O'Neill said any move that makes funds and their trustees put more emphasis on the needs of members is welcome.
"The limits on fees is also welcome but it should be a first step to a more transparent fee structure for all funds not just MySuper. This will allow members to compare funds and make investment choices easier.
"MySuper is a good start for members who decide not to actively choose where their super is invested but it should not be used as an excuse for funds not to actively engage
"Government and the super industry have to introduce measures to educate and inform Australians, so they can make informed choices about investing for their retirement," said O'Neill.