Nick Sherry (Tasmania, Australian Labor Party, Minister for Superannuation and Corporate Law) Share this | Hansard source

Firstly, the IRC is public, it is transparent and people can put their case through the decision. Secondly, Senator Abetz quotes figures—fees of 0.5 to 0.8 per cent for firms with more than 1,000 employees—but what has been kept secret is what happens to that fee when an employee leaves that business. Unfortunately, I am sad to say, some funds are in the practice of doubling the fee, because they flick them over to the retail section of the trust.

Yes, competition is good. But, if this was a perfectly rational world where people were well-informed about super and made informed choices, why would we make it compulsory in the first place? People do not make informed choices—they do not save for retirement. To expect 10 million people to make rational decisions without some fundamental protections is, I think, a misunderstanding of human nature.

Senator Abetz states a concern about multiplicity of payments. Senator Abetz, employers are not concerned about the multiplicity of payments to different default funds; what they are concerned about is the multiplicity of payments they have to make to different funds as a consequence of choice of fund. Employees front up and say they want this fund or that fund—to the extent that that works, it is about 10 per cent of the workforce. That is the real concern of employers about your choice of fund regime. I am informed that Tasplan—which I am obviously familiar with; it is from my home state—is the default fund in the retail sector as of 12 September.