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SMSF trustees back union fund crackdown

Newly appointed assistant treasurer Josh Frydenberg has indicated his intention to dilute trade union influence over industry super funds – much to the delight of an SMSF trustee body.

In an interview with Fairfax, Mr Frydenberg said he intends to introduce “genuine competition” into the superannuation market, including on the controversial issue of default super funds.

“I don’t have a lot of faith in the current system. It leaves retail funds and small industry funds at a disadvantage. I am determined to act on that,” Mr Frydenberg told the Australian Financial Review.

The assistant treasurer also expressed his commitment to the Coalition’s longstanding policy desire to see more independent directors placed on super fund governance boards.

Reflecting on the comments, the SMSF Owners’ Alliance (SMSFOA) issued a statement endorsing the increased focus on fund governance.

“The supervision of APRA-regulated funds should be as least as stringent as the governance standards required of banks and other large corporations,” the statement said.

“In particular, a majority of the trustee company boards of public offer funds should be independent. Independent trustees are better placed to make objective decisions in the interests of all fund members; conflicts of interest are likely to arise less often and be better managed.”

SMSF trustees take great interest in the subject as many “hold accounts with large managed funds”, the statement said, adding that the self-managed sector does not suffer from the same “trust” issues endemic in the debate about managed fund governance.