AUSTRALIA - The Australian Labor party has denounced the government's final regulations for superannuation choice as "costly, complex and unsafe" and called for an exemption for small business from the legislation.
Shadow minister for finance and superannuation, senator Nick Sherry, said the legislation, including the standard choice form for the implementation of choice of super fund on July 1, created a “massive compliance burden” for some 400,000 employers.
A further 200,000 employers and two million employees would be added to the “complex regime” on July 1, 2006, he added.
“Small business will be the hardest hit by the new compliance burden,” Sherry said. “That is why Labor is calling for an exemption for small business from super choice.”
Sherry described the regulatory framework as “unsafe” and said it failed to protect consumers against fee rip offs.
“For example, entry and exit fees and commission based selling is still permitted provided it is “disclosed” in complex, lengthy 50 page plus disclosure documents,” he said.
Other criticisms included the inclusion of Retirement Savings Accounts (RSAs) as a default fund with no insurance coverage. The Labor party said this was not a level playing field, considering other types of funds were required to have coverage.
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