Proposed changes to superannuation fee disclosure still don't solve the problem, Industry Super Australia's latest submission to ASIC warns.
Industry Super Australia has provided input on ASIC's proposed changes to Regulatory Guide 97 (RG97), which aims to improve transparency around how superannuation funds and managed investment schemes reveal their fees and costs to consumers.
The submission makes it clear that the proposal put forward by ASIC does not go far enough to address the inherent complexity of fee disclosure, meaning consumers still won't get the clarity they need to make informed decisions based on fees and cost comparisons.
Industry Super Australia Chief Executive Bernie Dean said that while attempts to improve the system were long overdue, the ASIC proposal could in fact lead to consumers being more confused – not less.
"The current proposal by ASIC only serves to reinforce the inconsistent and confusing fee disclosure structure – whereby platforms owned by banks and investment managers would only be required to disclose the cost of gaining access to a product, not the cost charged by those issuing the product," Mr Dean said.
"This means consumers may believe these products are less expensive, while unaware they will then have to pay additional fees and charges on top of what has already been disclosed.
"Consumers should be able to make fair and reasonable comparisons and have confidence that they are comparing apples with apples," he said.
"Under the current ASIC proposal, all consumers will benefit from is empty rhetoric and more confusion."
Industry Super Australia's submission sets out a number of recommendations to ASIC to improve RG97, including its key proposal that the most effective disclosure regime is one that places a 'net returns measure' – incorporating the effect of fees and costs – at its core.
