Workers to gain from super reform: Shorten

SYDNEY (AAP)-21.09.2011- Retirees will be tens of thousands of dollars better off under proposed changes to the superannuation system, the federal government says.
Under the Stronger Super plan released on Wednesday, member fees are expected to be slashed by up to 40 per cent, while a simple default product MySuper will be made available from July 2013, and lost and inactive accounts will be easier to consolidate.
"We want to see Australians achieve adequate retirement savings so that once they finish working they are able to live a life of some decency and dignity," Superannuation Minister Bill Shorten said on Wednesday.
Australia has about $1.3 trillion in super savings and this is expected to grow to $3 trillion by 2020.
Under the package, a 30-year-old full-time employee on $68,000 a year could have $40,000 more when they retire, the minister said.
The package complements the government's plan to lift the superannuation guarantee paid by business from nine to 12 per cent of an individual's salary.
Employers will be required to contribute into a fund offering a MySuper product if an employee has not chosen their own fund.
The reforms will also boost regulators' oversight powers and streamline fees, transactions and administration.
The moves have been widely welcomed by the superannuation industry.
Financial Services Council CEO John Brogden, who represents many of the largest retail funds, said it was a "balanced and measured package".
He said the ability to tailor some aspects of MySuper products and investment strategies was an improvement on earlier suggestions.
The council also welcomed tick-a-box account consolidation for superannuation balances greater than $1000 and risk-based capital requirements for super funds.
One of Australia's largest private superannuation providers, BT Financial Group, said the package was flexible and would provide a solid foundation for the industry's future.
"Our view has always been that the simpler the system, the more likely Australians are to take an active interest in their retirement savings," BT's Melanie Evans said.
Coalition spokesman for financial services and superannuation Mathias Cormann said the opposition would consider the plan carefully.
But he questioned why Mr Shorten did not act on the Cooper recommendations to improve corporate governance arrangements, such as having independent directors on superannuation boards.
Draft laws are due to be released for comment in the next few weeks and legislation is due to be introduced to parliament in early 2012.