Banking royal commission: expect shocking stories from super sector: Kelly O’Dwyer

Kelly O’Dwyer urges the public to brace for more shocking stories as the royal commission turns its spotlight on super.

19/03/2018. Finance Services Minister Kelly O'Dwyer speaks at the ASIC Annual forum held at the Hilton hotel in Sydney. Britta Campion / The Australian

The royal commission into misconduct in the financial services sector could deliver some shocking stories about the superannuation sector, Federal Revenue Minister Kelly O’Dwyer warned today.

“Many Australians have been shocked by some of the case studies examined so far by the Royal Commission,” Ms O’Dwyer said in a speech to the Financial Services Council summit in Melbourne today.

“I’m sure it will be no different when the commission turned its attention to the superannuation sector,” she said.

Ms O’Dwyer was speaking ahead of the royal commission’s planned hearings on the superannuation sector which starts on August 6.

She said the royal commission represented an “unprecedented opportunity for the industry to reflect on the practices and actions which have resulted in the commission — and so too for the regulators.”

Ms O’Dwyer said that the federal government would be closely studying any recommendations by the royal commission in its final report, which is expected to be delivered early next year.

But she urged the superannuation industry to use the royal commission to “draw a line in the sand” when it came to any questionable practices.

“Use it to separate the behaviours which should not have occurred in the first place,” she said.

She said the financial services industry had a duty to “repair trust” with Australian consumers.

This would need “effective leadership, good governance and appropriate cultures.”

“These are matters that companies need to tackle head on,” she said.

She said the government would be “looking to firms to ensure they take all necessary action and play their part in restoring that trust.”

“Reflect and reform is an appropriate motto.”

She said the significance of Australia’s $2.6 trillion superannuation system for the well being of all Australians could not be overstated.

Ms O’Dwyer said the federal government was expecting its amnesty for employers to correct any underpayments in their superannuation guarantee obligations to see some 50,000 employees get another $230 million in their superannuation.

The amnesty was introduced ahead of new reforms being introduced to give the Australian Taxation Office more scope to crack down on employers who did not meet their superannuation contribution obligations.

She said the reforms underway would also bring in tough new penalties, including possible jail time, for employers who repeatedly fail to meet their super guarantee obligations.