Questioning the Fairness of Forcing SMSFs to Fund Compensation Schemes

Critics of the proposed levy argue that it is fundamentally unfair to require self-managed superannuation fund trustees to pay for a compensation scheme they are largely unable to access. Many in the SMSF sector point out that they operate under different regulatory frameworks and often do not benefit from the same consumer protections as retail fund members. Accounting and industry bodies have warned that this move shifts the financial burden onto investors who had no role in the misconduct that led to the claims. They argue that the government should instead focus on the root causes of financial losses, such as the behavior of specific managed investment schemes and product issuers, rather than imposing costs on unrelated sectors. By forcing SMSF members to underwrite the failures of others, the government risks creating a moral hazard where the true drivers of financial harm are not held adequately accountable, while everyday savers are left to foot the bill for systemic issues they did not create.