End Commissions: ISF

Sales Commissions on Superannuation Products Must Go
Industry Super Funds were not surprised to see that two of the major findings from the ASIC survey were:

• A third of this advice lacked credible reasons and risked leaving the consumer worse off, where consumers were advised to switch funds; and
• Unreasonable advice was three to six times more common if the adviser had an actual conflict of interest over the advice given to the client. These conflicts were commonly created where either the adviser stood to get higher remuneration if the recommendation was followed, or the recommended product was associated with the adviser’s licensee.

The financial adviser will never be able to get away from the conflict of a commission, unless the opportunity to earn a commission on superannuation products is removed.

Industry Superannuation Funds again calls for the removal of commissions on superannuation contributions. Once that conflict is removed, members throughout Australia will have greater confidence that their adviser looks at all options for the retirement savings before making a final recommendation.