Feds order an examination of Australia’s superannuation system

Many people in Australia’s superannuation industry are worried about the Federal government’s decision to order a thorough examination the examination of the industry’s performance..

Although they have agreed to co-operate with it, industry executives are still unsettled, in particular, by the timing of  the government’s move.

The share market crash, after the collapse of Lehman Brothers last September, hit Australia’s superannuation funds very hard.

The industry research organisation, Superratings reported earlier this month that the value of assets held by the super funds plunged by more than 18 per cent in the first eight months of this financial year.

And an 18 per cent slice, of assets that are still worth more than $1 trilli0n, represents  very big losses indeed, in raw dollar terms.

The industry knows that the public is very well aware of these losses – and is very angry about them.

It  can point out that super fund members are still well ahead, on sums done over the last seven financial years.

A very impressive $651.3 billion ahead, in fact.

But no-one is listening to that kind of talk, right now.

So the industry’s fears, that this examination could turn into a witch hunt is understandable.

Australia’s banking industry has not been asked to submit itself to a similar process.

The Federal Superannuation Minister Nick Sherry, though, describes the proposed examination as “timely.”

“After nearly 20 years of compulsory superannuation and the development of numerous new features the Government, with the support of the industry, has agreed that it is timely and appropriate that an examination take place,” he said.

Although the industry did, indeed, agree to the examination, no-one in the industry has yet been heard shouting Hallelujajh at the news.

Related stories:

1. Australian investors – including you – lose almost $100 million over the past year
2. Superannuation:the legion of the lost
3. Feds moving in on shonky mortgage brokers