SYDNEY, July 3 — Australia’s superannuation system has developed a costly blind spot, and regulators say the problem is concentrated in a part of the industry most members do not even know they are in. The Australian Securities and Investments Commission recently examined six of the country’s largest platform trustees — organisations responsible for safeguarding $400 billion of retirement savings.
According to the regulator, those trustees showed “serious and persistent failings” across three core obligations: ensuring members get genuine value for money, making sure members understand what services they are paying for, and delivering the investment, member and retirement services that sit at the heart of what a superannuation trustee is supposed to provide. Officials said those three expectations were not complicated or tricky.
Yet the review found failures across all of them. To understand the problem, one must understand what a platform actually is. Most people do not walk into a financial adviser’s office and ask for one.
The adviser recommends it. In fact, most advisers have built their businesses around using platforms to manage their clients’ assets.
A platform lets an adviser look after all of a client’s investments in one place — superannuation, shares, managed funds and ETFs — with detailed reporting and tax tracking built in. Most advisers, the account indicates, would prefer to move their clients onto a platform rather than keep them in a low-cost industry super fund. The implication is clear: members may be paying for services they do not understand, through a structure they did not choose, and the trustees meant to protect their interests have been falling short.
The review raises questions about whether the platform model, now central to how financial advice is delivered in Australia, is delivering genuine value to the millions of members whose retirement savings sit inside it. With $400 billion under supervision across just six trustees, the scale of the potential cost to members is significant. What remains to be seen is whether the regulator’s findings will prompt the industry to reform its practices, or whether the government will step in with new obligations.
For now, the message from ASIC is that the system’s safeguards are not working as intended — and members may be paying the price.
