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Industry Super Australia has released a report titled “Finance and Capital Formation in Australia” in which it concludes that whereas in the early 1990s $1 invested into the finance sector used to result in the creation of $3.50 of capital that has reduced to only $1.50. Clearly a significant decline and cause for concern as to the efficiency of investing that pool of industry super funds into this sector.

ISA’s analysis has identified the culprit as being the disproportionate rise of employment and salaries in stockbroking, financial planning, secondary trading and asset management sectors with employment growth double that of the remainder of the sector and salaries averaging $250,000 a year verses $175,000 in superannuation and insurance and $130,000 in finance.

While not diminishing the validity of the findings it is worth remembering that industry super funds have waged a long-term battle against auxiliary services such as financial planners, and the timing of this report just as the largest review of the finance industry in 15 years commences is no accident.

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