Red Tape Killing Super Schemes
Act leader Richard Prebble has just discovered the number of workplace super schemes is falling.
Sunday, November 11th 2001, 10:07PM
A report that workplace superannuation schemes are becoming a thing of the past, should alarm the government, Act leader Richard Prebble says.The Association of Superannuation Funds says less than 15% of employees were now members of workplace super schemes - down from almost 25% in 1990 - with many more schemes in the process of winding up.
"There are now very few schemes outside central and local government, Prebble says.
"Employers say that onerous reporting requirements placed on them by Parliament, is the main reason why workplace super schemes just aren't worth the time and trouble.
"It's not just the need to issue a prospectus but also the requirement to give detailed reporting on the fund's performance. Such reporting is not only expensive but also fairly meaningless for long-term investments.
"For example, a scheme that had to report in late September would have alarmed its contributors with news of a dramatic drop in the sharemarket, which now appears to have been short-lived.
"The regulations surrounding workplace super schemes are another example of the fundamentally anti-business attitude of both the government and the bureaucracy. The fact is, no super scheme registered with the Government Actuary has ever gone bust.
"Parliament was curing a problem that didn't exist and the cure has killed super schemes.
"The government would have been better off cutting unnecessary red tape from private super schemes rather than adopting the Cullen proposal which is a highly-risky scheme to borrow $2 billion a year and take a punt on the share market," Prebble says.
This is a press release from Richard Prebble, the leader of the Act party.
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