Outline of the Collective Investments reports
The inquiry into collective investments was conducted jointly with the Companies and Securities Advisory Committee (CSAC). Its aim was to review the regulatory framework for prescribed interests and similar collective investments schemes.
ALRC 59 identified two means of government intervention to ensure retirement savings in superannuation were protected - requiring superannuation schemes to insure against the risk of failure; and prescribing measures to reduce liquidity and institution risk. The report reflected that prudential supervision was an acceptable way of intervening in the market.
ALRC 59 concluded that existing methods of regulatory control of superannuation schemes were unsuitable.
ALRC 65 found that collective investments were a rapidly growing sector in investment in Australia, of considerable importance to the economy. The report concluded that policy should therefore ensure the twin objectives of encouraging business activity while ensuring that investors were adequately protected. In identifying the types of risk that collective investors face, the report proposed that although the government should not intervene to reduce investment risk it should intervene to reduce or control compliance and institutional risk.
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The information on this page was current as of January 2005
This page was posted 28 October 2002
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