In a submission to the Productivity Commission’s ongoing review into the super system, the SMSF Association said a survey conducted among SMSF members during August revealed that overall impressions of superannuation had declined.
“There has been a decline in both satisfaction with how the system has performed for them and the trust they have in the system to deliver the best outcomes in retirement,” the submission said.
“We believe that these relate to constant regulatory change, most notably in regards to the 2016 Budget announcements that have been the cause of much frustration.”
The SMSF Association said this is also reflected in earlier research such as the 2015 SMSF Association Intimate with Self-Managed Superannuation Report which indicated that advisers most commonly cite regulatory or legislative change as the greatest challenge they face in advising SMSF clients.
“Similarly, a Vanguard and Rice Warner survey of SMSF trustees noted that 88 per cent of respondents were concerned that they will be significantly impacted by changes to superannuation or taxation law,” the submission said.
The survey also indicated there were mixed responses relating to how information on fees and features for SMSFs is relayed to members.
“Members found that the information on their SMSF’s fees and features, and similar information across the superannuation system more broadly, was easily accessible,”
“However, the feedback was not as strong when relating to how well people understood the fees and features. This could be attributed to the complex nature of reporting that can sometimes be displayed by superannuation funds, the regulatory burden which has forced fees to rise and the need for financial advisers to then explain these changes to their clients.”
The survey also found that members were less satisfied with the availability of comparable information on fees and features for their SMSF and across the system more broadly.
“This shows an indication that SMSF members cannot really compare the performance of their fund with other SMSFs and against the institutional funds due to different reporting styles and methods,” the submission said.
“This is an important area that should be looked at by the Productivity Commission to ensure that all superannuation system participants can compare their funds to others in the market.”