CLIENT UPDATE 20 April 2010
MySuper - The Cooper Review’s Latest Preliminary Report The Cooper Review has today released its latest preliminary report called MySuper: Optimising Australian Superannuation.
What is MySuper? ‘MySuper’ is the new name for the universal fund concept originally proposed in the Cooper Review’s Phase One preliminary report, Clearer Super Solutions, released on 14 December 2009. MySuper is intended to be a simple, cost-effective product with: •
No trailing commissions;
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No contribution fees;
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A duty on the trustee to manage the overall cost to members;
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A default post-retirement product; and
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Trustee duties focused on members.
These changes are designed to emphasise the role of the trustee and to help ensure that members do not inadvertently pay for services they either do not want or do not know about. Important notes: •
For members who want a fund that offers more choices and options or who want to manage their own super in a selfmanaged super fund (SMSF), they are free to do so.
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It is probable that some of the changes under MySuper will be recommended to apply across superannuation.
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The Cooper Review is not proposing to recommend a single national default fund to implement MySuper. Rather, MySuper would operate within current existing superannuation fund structures. MySuper will include regulatory requirements to ensure that the trustee remains accountable to members, acts in the best interests of members and controls the costs of delivering MySuper.
For a copy of the paper, please click here.
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Where to from here? The final report of the Cooper Review encompassing (1) Governance, (2) Operation and Efficiency and (3) Structure (including SMSFs) will be delivered to the Government by 30 June 2010, although there is some speculation that it will be delivered considerably earlier than this. If the Government accepts the MySuper recommendations, then it will need to take the steps necessary to put it into effect including passing the required legislation. The Cooper Review has recommended that as part of this process, industry participants be given time to assess and prepare for any implications. TurksLegal will continue to monitor MySuper and keep you up-to-date with developments as they arise. Paul Cleary has considerable expertise in the provision of specialist financial services and would be pleased to offer strategic superannuation legal advice.
For more information, please contact: Paul Cleary Partner Insurance & Financial Services TurksLegal T: 02 8257 5760 M: 0407 052 170 paul.cleary@turkslegal.com.au
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