CPA Australia backs stronger superannuation protections while preserving access to trusted advice

• CPA Australia supports stronger protections for Australians’ retirement savings 
• Mandatory SMSF education requirements needed
• Reforms must improve accountability without creating unnecessary costs for members

CPA Australia has supported the Government's proposed reforms to strengthen consumer protections across the superannuation system, saying the measures respond to serious concerns exposed by the collapse of the Shield and First Guardian schemes and should help better safeguard Australians' retirement savings. 

The reforms announced today by Assistant Treasurer and Minister for Financial Services Dr Daniel Mulino include a crackdown on unsolicited superannuation sales practices, stronger accountability requirements for trustees and mandatory education for prospective self-managed super fund (SMSF) trustees.

CPA Australia Superannuation Lead Richard Webb said the focus on preventing consumer harm before it occurs is an important step forward.

"The collapse of Shield and First Guardian highlighted the role that aggressive lead generation, pressure selling and unsolicited approaches can play in exposing consumers to inappropriate products and advice," Mr Webb said.

"CPA Australia supports action to stop unlicensed and conflicted operators targeting Australians' retirement savings. Consumer protection is strongest when harm is prevented before it occurs."

The Government has announced plans to prohibit unlicensed real-time communications about superannuation and narrow existing anti-hawking exemptions, measures designed to disrupt business models that rely on cold-calling, lead generation and high-pressure sales tactics.

Mr Webb said it will be important that the final legislation clearly differentiates between harmful sales conduct and legitimate professional engagement.

"The final legislation should clearly distinguish harmful sales activity from legitimate education and professional referrals so that consumers continue to have access to trusted sources of information and advice."

"There is an important difference between unlicensed product promotion and professional education that helps consumers make informed decisions."

"The framework must also recognise the role accountants and other trusted professionals play in helping Australians understand their options and seek appropriate advice,” Mr Webb added. 

Mr Webb said stronger consumer protections should complement, rather than replace, effective product regulation and oversight.

"It should also be acknowledged that these reforms do not remove the need for robust supervision and regulation of financial products themselves. Australians should be able to have confidence that harmful products are identified and addressed before significant consumer losses occur,” Mr Webb said. 

Stronger trustee accountability welcome

CPA Australia also welcomed proposals requiring superannuation trustees to hold sufficient capital to compensate members in circumstances involving significant losses, saying recent fund failures have raised legitimate questions about accountability, governance and financial capacity.

"Australians should be confident that the entity responsible for protecting their retirement savings has both the authority and the financial resources to discharge that responsibility," Mr Webb said.
"The key issue is ensuring that legal responsibility, governance oversight and financial capacity are properly aligned."

Mr Webb said reforms should focus on accountability and member protection without unnecessarily disrupting effective operating models across the sector.

"CPA Australia supports measures that strengthen accountability and member protection, but it will be important to ensure that capital requirements are appropriately calibrated and do not create unnecessary costs or disruption for fund members."

"Legitimate outsourcing arrangements can play an important role in the system and should not be disrupted unnecessarily where governance and accountability remain clear."

"Any transition to the new arrangements should be carefully managed to minimise impacts on members."

Mandatory SMSF education supported

CPA Australia has also welcomed the Government's proposal to introduce mandatory education requirements for individuals seeking to establish an SMSF.

"Taking responsibility for an SMSF involves significant legal, governance and investment obligations. CPA Australia supports measures that help Australians understand those responsibilities before making the decision to establish an SMSF," Mr Webb said.

"Education should be practical, accessible and proportionate, giving prospective trustees a clear understanding of both the opportunities and responsibilities involved. Better-informed consumers make better decisions, which ultimately strengthens confidence across the entire superannuation system,” Mr Webb said.

Mr Webb said today's reforms represent an opportunity to strengthen trust in Australia's retirement savings system while ensuring consumers retain access to quality information and professional support.

"Australia's superannuation system is one of the nation's most important financial institutions. Reforms that improve accountability, reduce consumer harm and support informed decision-making will help protect confidence in the system for years to come."

CPA Australia also supports giving the ATO a targeted power to prevent rollovers to newly established SMSFs while concerns about fraud, financial abuse, misconduct or potential harm are being investigated. The measure could provide an important safeguard before a member’s retirement savings leave the APRA-regulated environment. 

“Giving the ATO a targeted ability to intervene could prevent serious consumer harm, but the power must be exercised transparently and without unnecessarily delaying legitimate rollovers,” Mr Webb said. “Clear risk indicators, prompt communication, reasonable decision-making timeframes and appropriate review rights will be essential.”

Media contact

Camille Hanton
External Affairs Lead
[email protected]
0431 180 475