The Australian, March 20, 2017:
Union-aligned industry super groups are attempting to get the public on side in their war with the banks over how default superannuation funds are chosen, with a new ad campaign.
The “banks aren’t super” campaign aims to stir fears that the changes will reduce members’ super nest eggs.
It characterises the banks as foxes descending on a henhouse, and the Turnbull government, which has been pushing for the changes, as the ones opening the henhouse door.
In October 2015, the government accepted a recommendation from David Murray’s Financial System Inquiry for the introduction of a competitive tender process for employers allocating default funds to members.
Scott Morrison said industry funds were operating in a “closed shop” that was stifling competition and allowing fees to eat into retirement savings.
Retail super funds such as those owned by the major banks, which manage about $540 billion, want the rules changed as they believe they advantage industry funds, which manage about $440bn.
Industry Super Australia chief executive David Whiteley said the changes would benefit only the big banks and would “put at risk the long-term investment outperformance” of industry super.
“The banks want to replace the cost-efficient and high-performing not-for-profit model with cross-selling to consumers and by bundling business banking and super with employers,” Mr Whiteley said.
The industry believes the government will bring legislation to parliament to make the changes later this year.
The Minister for Revenue and Financial Services, Kelly O’Dwyer, has been spearheading the push for changes to super.
Apart from making changes to the default super, the government is also pushing for governance changes to require more independent directors, transparency rules to change what funds reveal about their investments, and changes to the restrictions in enterprise bargaining agreements.
