Unions welcome today's publication of the interim report of the Financial System Inquiry.
ACTU Assistant Secretary Tim Lyons said unions have long argued that Australia needs a more efficient financial system.
"Australia needs a financial system geared to supporting job-rich investment and better retirement incomes rather than generating huge profits for banks, insurance companies and wealth managers.
"In particular, unions welcome the interim report's view that superannuation fees in Australia are too high, and that the changes the government wants to make to the Future of Financial Advice (FOFA) laws are not in the best interests of customers."
The Report notes that high super fees can reduce the savings workers have when they retire by an average of $40,000, largely due to high fees being paid to fund managers.
"Industry funds are for members, not big companies chasing profits, so on average they charge less in fees than retail funds and deliver more when workers retire," said Mr Lyons.
"The interim report's focus on reducing fees and on ideas for more innovative retirement phase products like annuities is consistent with ACTU policy. We aren't convinced by some of the suggested policy ideas floated in the report, but the objectives are sound and we'll be engaging on that basis."
The report did not support the view of retail super funds and government ministers that any MySuper product should be eligible to be chosen as a default fund by employers, Mr Lyons said.
"Super contributions should be viewed as deferred wages and are therefore appropriate to industrial regulation and collective bargaining.
"Workers and their representatives are best placed to decide which MySuper product is in their interests – not just any MySuper product chosen unilaterally by an employer following consultation with their bank."
Unions also welcome the interim report's view that the government's proposed changes to FOFA laws is not in the best interests of consumers.
"The report highlights research by ASIC which shows consumers have lost substantial sums because financial advisers were acting in their own interests, rather than those of their customers." said Mr Lyons.
Unions strongly support the FOFA reforms that became effective in 2013 and oppose the changes the government currently wishes to make at the behest of the banks.
"The Financial Systems Inquiry Interim Report is a further blow to the government's plans to water-down vital protections for those who rely on good quality financial advice. All Senators should take this report as another clear signing that gutting FOFA is a bad idea" said Mr Lyons.
Media contact: Kara Douglas 0418 793 885