Stand by for interesting times in the superannuation industry as the newly fledged alliance between the retail and industry sectors shapes a whole new landscape. BlueChip has been on the scene at the FSC Annual Conference 2013 and is reporting the action first-hand.
Look behind Wednesday’s laying down of swords between the retail financial services sector and its traditional foe, the Industry Super Network (ISN), and what you see is a large dose of political expediency from both sides. For more on the story, see here.
Cynical, yes, but what brand of politics has no long game self-interest? As we head to a federal election where the likelihood of a coalition team making government is strong, it makes sense for both sides of the superannuation ideological divide to at least give a public impression of genuine hand holding. It is in their individual and mutual interest to do so. Doing it under the banner of consumer wellbeing is an obvious tactic; it’s called taking the moral high ground.
There are two things of grand note in this newfound common ground approach to resolving big ticket policy issues in superannuation.
One. Both sides of the industry/retail super divide understand the adage of keeping your friends close and your enemies closer. In other words, it pays to not be blind-sided when attempting to win a strategic advantage. It also puts others on notice that your allied front will be looking for new enemies (take note the SMSF lobby).
Two. Politicians of all persuasions are tired of negotiating with dissenting voices from the superannuation sector. They would be encouraging this new allegiance as a future pathway to achieve consensus with minimal fuss about the complexities of determining the future policy settings underpinning the nation’s growing superannuation pot. There is also the desire to create greater security in the system and build sustainable future models that can withstand the travails of the next economic or financial crisis. The notion that superannuation is too big to fail is helping to drive much of the discussion – and certainly the regulatory oversight – at this level.
The real test for the Financial Services Council (FSC) and ISN ‘co-opetition’ agreement will not lie within their own wagon circle.
It lies without.
The voice of the self-managed superannuation sector was the glaring omission in the rhetoric that announced the deal at the FSC Conference on Wednesday. Combined with other constituents not represented by the two newly aligned bodies, including many small public offer super funds, some corporates and the advice sector, the post election dynamic will be interesting, to say the least.
These are galvanising times for all players as the jostling for ascendancy hots up.
But meantime, as strange bedfellows ISN and FSC get to know each other during this honeymoon phase, sorting out their core ideology from practical expediency and learning to value their differences, remember that any guests to the celebration should politely refrain from mentioning the war.
