The Corporate Super Specialists Alliance (CSSA) lobby group has welcomed policy proposals by AMP and the Commonwealth Bank that would allow the sub-sector to continue operating.
In a statement, CSSA president Douglas Latto said one solution suggested by the CBA and AMP recommends making an employer a wholesale client rather than a retail client, which would remove the conflict.An alternative solution put forward by global law firm Minter Ellison in the firm's public submission suggests making intra-fund advice exempt from conflicted remuneration.Of the two options, Mr Latto said making the employer a wholesale client would also offer the best outcome for employees.“Current legislation means corporate super specialists have to act in the best interests of the employer when helping them select default funds for their employees,” he said. “We believe when they prepare tenders, corporate super specialists should be acting in the best interests of the employees.”Mr Latto said a “timely solution” is necessary because with modern award reviews occurring on default super, there are potentially thousands of employers wanting and needing help selecting a new fund. Currently, if corporate super specialists complete a tender or product selection, they will not be able to receive remuneration as it will be considered conflicted, he said.“While the [Parliamentary Joint] Committee recognised this problem and is supportive of the concept that corporate super advisers need to be remunerated for the services they offer, no solution has yet been put forward,” said Mr Latto.
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