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AIST outlines MySuper proposal
The Australian Institute of Superannuation Trustees (AIST) has reiterated its opposition to tailored MySuper products for employers, saying it detracts from simple, transparent, and comparable products.
If employers could offer countless different white label options with different administration or insurance arrangements, it could lead to hundreds of MySuper products, said AIST project director David Haynes.
Such a system would be more complicated, less simple, less transparent, and lead to less disclosure, he said.
Treasury has previously told Association of Superannuation Funds of Australia members that the fee and insurance flexibility in MySuper made it unnecessary to create and tailor separate MySuper products for employers.
The AIST also raised concerns about the opportunity for flipping employees from one MySuper product to a more expensive MySuper product without their knowledge or consent.
"We don't think that's a good policy outcome," Haynes said.
Haynes also questioned whether the ban on giving general product advice to employers would impact on a super fund's ability to form relationships with employer groups.
Competition was already heating up between super funds for employers to join, he said.
Haynes encouraged super funds to rename their existing default option as a MySuper product, which would save structural costs, administration costs, and mean no change to investments and insurance.
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