BGL hits back at AustralianSuper’s attack on SMSFs

BGL chief executive Ron Lesh said the comments made by Mr Silk were extremely disappointing and that he lacked an understanding about why members are attracted to SMSFs.

“Ian, like most chief executive executives and directors of industry and retail funds, simply just doesn’t get it,” Mr Lesh said.

“People move out of large funds because of the lack of transparency, the huge salaries paid to executives, the unrepresentative boards, the hugely wasteful advertising expenditure, but most of all, the desire to control their own destiny.”

Mr Lesh said the data from the Productivity Commission that Mr Silk is using to base his comments from is incorrect.

“Industry data over the past 20 years shows SMSFs, over the long term, have generally performed better than industry and retail funds. And the breakdown of funds that performed better or worse is very subjective,” Mr Lesh said.

“Some SMSFs with balances as low as $50,000 have performed better than all other funds,” Mr Lesh added.

He also noted that performance of a fund also depends on the mix of assets.

A simple example, he said, might be an SMSF with a property that has experienced significant growth and has returned 40 per cent on its $50,000 member balance.

“It seems to me that Ian is concerned when he sees so many large balances leaving his fund,” Mr Lesh said.

“Maybe he should be looking at the reasons why rather than attacking a part of the super industry that is performing well, is independent and is meeting the needs of its members.”