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The Cooper Review of the Superannuation system

By WLM Financial Services
7 July 2010

The Cooper Review has made a number of recommendations for reform, which have been summarised into ten packages, covering the following topics:

1. MYSUPER and choice architecture
2. Trustee governance
3. Investment governance
4. Outcomes transparency
5. Insurance in superannuation
6. Integrity of the system
7. Retirement
8. Self-managed super solutions
9. Superstream
10. Regulatory settings

These ten packages, which form the 336 pages of Part Two of the Cooper Review's formal response reiterate many of the preliminary recommendations made throughout the course of the review process over the last 13 months.  There is a strong focus on two major areas of reform, being:

• The introduction of a standardised "MYSUPER" fund - a low cost, low feature super offer for many members, and
• The need to introduce efficiencies through a move to e-commerce and electronic data transmission / communication.

The Government's response

In releasing the Report, the Government has noted its support for initiatives that will move superannuation to a more efficient environment, particularly through the use of increased technology, as well as any other moves to make super more cost effective and easier to understand.  Ultimately the Government is looking at those measures which will assist members to have more saved for their retirement.

Having said that, at this point in time the Government has not committed to any of the recommendations made by the Cooper Review, nor have they ruled any out.  Rather, they have indicated their intention to consult closely with industry and affected parties on the range of recommendations that have been made in order to formulate those recommendations which are to be implemented.

What this means for you

At this stage, all we have are the Cooper Review's recommendations and a statement from the Government that it will undertake further consultation on these recommendations.  No changes to your current strategy should be made as a result of the release of this Report.

It's also important to remember that a Federal election is expected to be called in the second half of this year, and the outcome of that election could have a bearing on which recommendations are ultimately enacted by future Governments.

Further details of the 177 recommendations can be found at the following website: www.supersystemreview.gov.au There will be more thorough reviews of the final Report over the coming weeks.

Please feel free to contact your adviser at WLM Financial Services for more information or to consider how this may impact your super.

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