AustralianSuper asked to justify ‘whopping fee slug’
THE corporate watchdog is investigating whether AustralianSuper was forthright with members about the decision to introduce a new levy.
Liberal Senator Andrew Bragg has welcomed the probe, saying the Australian Securities and Investments Commission needed to “shed light” on whether the fund could “justify a whopping fee slug”. At a Senate hearing, ASIC said it was probing AustralianSuper’s new “Protect Your Super” fee.
The watchdog said it was investigating whether the fund’s decision to blame the 0.04 variable fee on the Coalition’s legislation was honest. Only a handful of 200 super funds had introduced a similar levy.
The hearings revealed AustralianSuper had already been forced to amend information provided to its members, and been asked to provide further information about the levy.
ASIC chair James Shipton said it was a “very serious matter”.
Led by chief executive Ian Silk, AustralianSuper is the nation’s biggest super provider.
The $182 billion fund said the fee hike would offset the impact of government legislation aimed at protecting lowbalance or “zombie” super accounts.
Senator Bragg said reforms were “designed to get fees down, not the reverse”.
“This investigation must shed light on how one large fund can justify a whopping fee slug,” he said. “The report should be released publicly and I am pleased the ASIC chair is taking it very seriously,” Senator Bragg said.
“The super industry trades on opaqueness. They increase fees under the cover of reform hoping that people will never understand the system.”
At the hearing, moments before Mr Shipton described the matter as ongoing and “very serious”, ASIC deputy commissioner Danielle Press told Senator Bragg that “we don’t believe it is something we would take further action on”.
ASIC is unable to pursue claims of misleading and deceptive conduct because it is not the lead conduct regulator in superannuation, but is investigating matters relating to disclosure.
The head of the Australian Prudential Regulatory Authority, Helen Rowell, told the Senate hearing it believed that nation’s biggest super fund had not breached requirements that it act in the best interests of members. “It’s about a redistribution of cost across the membership and in particular reducing the fees of low balance account members,” Ms Rowell said. “Some members will benefit and some members will not and pay a higher cost as a result of that.”
The Australian