Since 1984, when the world’s first superannuation fund was established, superannuation has experienced a number of changes and significant growth. Australian super funds are today managing over $2.3 trillion dollars worth of investments on behalf of everyday workers and their families. However, over recent years, funds and insurers have been accused of providing their members with ‘junk’ insurance policies with absolutely no or very little benefit.
Superannuation in Australia
At present, Australian superannuation funds are regulated by 2 organisations; Australian Securities and Investments Commission (ASIC) and the Australian Prudential Regulation Agency (APRA). These agencies are accountable to guarantee that members’ superannuation are being managed according to set principles and guidelines. However, previously they were powerless to enforce any action if a fund or insurer had breached their obligations. A high profile example is the story of the Commonwealth Bank and their commercial practices against their superannuation members in 2016.
Protecting your super
To protect everyday Australians, and to increase accountability for advisors and those in senior roles in banks and in the financial sector generally, new laws have been introduced for directors of superannuation funds who breach their duties and/or fail to meet their obligations, criminal penalties can be enforced and in certain cases APRA will have the ability to cancel or refuse a MySuper authorisation.
These new changes will allow superannuation members more transparency and clearer reporting around their funds under-management; a change that is long overdue and immensely needed.