The MySuper framework offers no recourse to randomly transitioned fund members who stand to lose previously-accrued insurance balances, Corporate Super Specialist Alliance (CSSA) argues.
With the transition already beginning, CSSA treasurer Gareth Hall said more needs to be done to alert members of their potential losses.
“We believe many members are not aware of the problem and consequently are losing millions of dollars in insurance cover, cover which they may never be able to obtain again.”
“How can any Government legislate the removal of such important benefits from taxpayers, and offer them absolutely no avenue for compensation?”
Ex-corporate super members are given the chance to state whether they want to retain their super arrangements, but Hall said he knows of at least one member who almost missed the opportunity to opt out of the transition.
“If this member had been arbitrarily transitioned into a MySuper fund, his current insurances would have been cancelled,” Hall said.
“Our gravest concern is what will happen to members who are not engaged. What if they have changed address or are on leave and are not able to be contacted? They will just lose out,” Hall said.
The fund has launched a new tool to help deliver personalised financial education and digital personal advice to eligible members.
The QAR lead reviewer has told a Senate committee that the government’s demands of super funds conflict with their original purpose.
The Joint Associations Working Group has identified four key issues with the $3 million super tax that need to be addressed before the bill is legislated, including the major concern of taxing unrealised capital gains.
The industry body has recommended an approach that recognises unique advice needs, noting current super regulation and legislation is “overwhelmingly designed with simple, default arrangements in mind”.