'Compelling case' for more disclosure in super funds
INDUSTRY superannuation funds have called for greater transparency after research showing fund managers were collecting $6 billion in fees each year from members.
The Rainmaker Information research, funded by the Industry Super Network, found the super industry drew about $20.1 billion in fees every year, with about $6.2 billion going to fund managers.
In the Australian super system, many operations were outsourced by superannuation companies to funds managers, administrators and consultants.
ISN chief executive David Whiteley said there was a compelling case for more disclosure across the entire super industry, with particular emphasis on fund managers due partly to the fees they receive.
"Compulsory superannuation is a public-private partnership," he said.
"It is an industry dominated by outsourcing arrangements, and typically only a small proportion of the total fees paid by members are retained by trustee offices."
The research showed 82% of all fees, or $16.5 billion, went to the wealth management industry, including advice groups, insurers, platforms and fund managers.
Mr Whiteley said super fund members should know the names and backgrounds of all directors and executives of their fund as well as their remuneration arrangements.
"Members should have confidence whatever the structure of their fund (either inhouse or outsourced) so they can find out about the people managing their savings," he said.
"Major service providers to super funds, who receive most of the money paid from the compulsory super system, should be subject to the same disclosure obligations as the super funds themselves."