Gillard’s MySuper idea is a dud
MySuper, the centrepiece of the Cooper Review’s proposals, would most likely result in workers receiving lower superannuation payouts, not higher. Not only that, it would result in workers being less educated about their super and less able to make informed decisions about it.
Chant West principal, Warren Chant says the MySuper concept has a certain superficial appeal. “Its mantra of ‘simple, low cost product’ is saying to the consumer: ‘Super is good for you, even if you don’t want it, so here’s a way to get it as cheaply as possible’. That’s all very well, but it fails to recognise that there’s a difference between price and value.
“With super, as with most things in life, you get what you pay for. Sometimes it’s better to pay a little more if that means the product performs better and lasts longer – and that’s exactly what you want from super. “Cooper treats super as a homogeneous product where the only differentiating factor is price, but that’s not the reality.
There are qualitative differences between funds. The better quality funds, in terms of investment performance, tend to have higher investment fees because of how they invest and what they invest in. But there is strong evidence that those higher investment fees pay off because they produce better net returns. In other words, the additional return is greater than the additional fee incurred to achieve it.”