Super funds fight LNP's union-busting
Industry superannuation funds are fighting against changes that threaten union control.
The Federal Government wants to shake-up the rules around governance of super boards, which tend to be dominated by union-linked members.
Reports say the Government wants to legislate for a third of trustees to be independent directors.
Industry Super Australia (ISA) – a lobby representing both union and employer backed superannuation funds – says a “one-size-fits-all” model will not work.
ISA's chief executive David Whiteley says the proposed shake-up defies evidence from superannuation researchers, which showed that industry funds comprised eight of the top 10 performing funds over the past year.
“We're very concerned; these changes are the most significant we've seen since the advent of compulsory super in 1992,” Mr Whiteley told ABC reporters this week.
“They impose a one-size-fits-all governance model over not-for-profit super funds and for-profit super funds when these funds are structured very differently, very deliberately.”
“These proposals are far more far-reaching than just acquiring independent trustees to be on superannuation boards.
“What the proposals actually do is remove the requirement that members and employers will be represented on the boards of not-for-profit superannuation funds.
“And, quite remarkably, what these proposals do is actually reduce the Government's obligations on the banking and [for-profit] superannuation funds that they've volunteered to sign up to themselves already.”
Industry Super has been battling the Federal Government over the issue for months, arguing that the proposed governance changes are intended to strike at the unions for ideological reasons.
“I think certainly that the community at large knows that, from time to time, the Government and the trade unions don't always see eye to eye,” Mr Whiteley said.
“People would be deeply alarmed if for ideological reasons the Government was seeking to change superannuation governance of super funds which could lead to people having lover returns and therefore lowers superannuation balances when they retire.”
The Government says it will introduce its legislation when Parliament resumes.
It should trigger a wave of intense lobbying, as retail funds run by big banks and insurance companies push for less restrictive rules.
It will be a hard slog for these groups too, as they are still in damage control after scandals in financial advice at the Commonwealth Bank, NAB and Macquarie Private Wealth.
The minister responsible, Assistant Treasurer Josh Frydenberg, has described the changes as “modest”, and says they will not threaten super returns.