People have been gaining early access to superannuation to help fund IVF treatment through the use of legal loopholes, according to prominent financial planners, Dixon Advisory.
In a submission to the Senate Economics Committee inquiry into Consumer Protection in the Banking Insurance and Financial Sector, Dixon called for such practices to be scrutinised.
Dixon expressed concern that some advisors were manipulating arrangements allowing people early super access due to financial hardship to fund IVF and some other medical procedures, Super Review has reported.
“We are aware of a company operating that assists superannuation fund members gain early access to their super to finance the individual’s medical treatment, including IVF treatment,” the submission said.
“It is important that this issue is analysed and evaluated from a consumer protection perspective; including the consideration of implementing safeguards into the process like: access to financial advice, full disclosure of fees charged by the company and the long term implications of the decision for the individual.”
Dixon also expressed concern about changes to the protection of small account balances, saying “the removal of member protections for small super fund accounts in combination with the changes to the lost super provisions means that casual workers and younger people with small account balances are often losing out as a result of the current legislative environment”.
“Protection for small balances and lost super is a consumer protection area that requires further deliberation,” it said. “Further, development of innovative strategies may be an effective way to address the problem.”