Consumers still find it difficult to compare superannuation funds because there is no uniform descriptors of what represents defensive and aggressive asset holdings and strategies.
A Super Review roundtable conducted during the recent Association of Superannuation Funds of Australia conference heard that comparability represented a real issue for the industry that needed to be addressed, Super Review has reported.
LegalSuper chief executive, Andrew Proebstl told the round table that comparability had become an issue, particularly with respect to MySuper funds and he questioned why the regulators were not dealing with the issue.
“….one of the issues that we’ve been turning our minds to is how funds classify between growth and defensive assets and if you drill into the underlying assets of some funds, particularly in terms of alternatives, they’re fairly aggressive with pulling out components of alternatives and categorising them as defensive assets when in reality they’re probably more growth assets,” he said.
He said any examination of a fund PDS provided a sense of what was going on, and he was surprised that the regulators did not get a similar sense and do something about it.
EISS Super chief executive, Alex Hutchison, agreed around appropriately defining defensive and growth assets and the problems it caused.
“Andrew pointed out about investment, about is it really defensive or growth — that can really hit home when people are comparing you because people compare you now online, people may not seek advice directly from you and, you know, that’s where you can really lose out,” Mr Hutchison said.
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