Retirement
Fox in the henhouse ads are anti-bank, in members’ interests: AusSuper
Retirement
Fox in the henhouse ads are anti-bank, in members’ interests: AusSuper
Industry funds’ controversial fox in the henhouse ads were in members’ best interests, with the advertisement’s worth measured through a thwarted legislative process, AustralianSuper told the royal commission.
Fox in the henhouse ads are anti-bank, in members’ interests: AusSuper
Industry funds’ controversial fox in the henhouse ads were in members’ best interests, with the advertisement’s worth measured through a thwarted legislative process, AustralianSuper told the royal commission.
Appearing in the stand yesterday, AustralianSuper’s Ian Silk has been the most high profile and sanguine witness to appear in this round of hearings, answering questions and even cracking jokes.
However, as he explained to the commission, AustralianSuper finds little comedy in banks’ interests in superannuation.
Responding to questioning around the fox in the henhouse ads put out in 2017, he said the intent was to position industry funds as against the banks, which were at the time lobbying for weaker employee protections.
“The purpose of the advertisement was to … prevent the lobbying effort that was being undertaken by retail wealth management companies, in particular the big banks, to change the default system from a framework that we say provided significant protection for workers to one that exposed workers to significant risks of misselling, cross-selling and conflicts of interest that would have done them significant damage,” Mr Silk said.
As it stands, most awards and enterprise agreements will have a superannuation clause identifying a number of funds from which employers can select the default fund, with a negotiation process between unions, funds and employers usually attached.
“The proposal was to essentially strip superannuation from the industrial system and allow employers the unfettered right to choose the default fund that would apply at their workplace,” he continued, arguing this would likely see banks leverage their relationships with employers to push them to choose bank-owned funds as the default.
“The misselling, the cross-selling, the conflict of interests in particular that would apply through that model present a situation where the very great likelihood, indeed, the express design objective of such a change, would be to see millions of Australians that would otherwise be in higher performing industry funds in poorer performing retail funds.”
Mr Silk said this would have a two-fold detriment; existing AusSuper members would lose the economy of scale as the flow of members entering the fund diminishes, while those who join retail funds will likely suffer poorer returns.
The ad wasn’t directed at any specific legislation, rather to address the “dramatic” increase in the political temperature around the issue. It was targeted at federal politicians directly and through their constituents, he added.
“The ultimate purpose was to ensure that legislation was not passed that would diminish the financial outcomes of superannuation fund members, in particular AustralianSuper members. So in that sense, the ultimate test is whether legislation passed,” Mr Silk said.
The royal commission hearings continue today, with IOOF boss Chris Kelaher in the hot-seat. You can follow our live-blog here.
RELATED ARTICLES
Superannuation
Expanding super for under-18s could help close the gender super gap, says Rest
In a push to address the gender disparity in superannuation savings, Rest, one of Australia's largest profit-to-member superannuation funds, has called for a significant policy change that would allow ...Read more
Superannuation
Employment Hero pioneers real-time super payments with HeroClear integration
In a significant leap forward for Australia's payroll and superannuation systems, Employment Hero, in collaboration with Zepto and OZEDI, has successfully processed the country's first ...Read more
Superannuation
Rest launches Rest Pay to streamline superannuation payments and boost member outcomes
In a significant move aimed at enhancing compliance with upcoming superannuation regulations, Rest, one of Australia’s largest profit-to-member superannuation funds, has unveiled an innovative ...Read more
Superannuation
Rest appoints experienced governance expert to bolster superannuation fund
Rest, one of Australia's largest profit-to-member superannuation funds, has announced the appointment of Ed Waters as the new Company Secretary. Waters, who brings with him over 15 years of extensive ...Read more
Superannuation
Small businesses brace for cash flow challenges as Payday Super becomes law
With the new Payday Super legislation now enacted, small businesses across Australia are preparing for a significant shift in how they manage superannuation contributions. The law, which mandates a ...Read more
Superannuation
Rest launches Innovate RAP to support fairer super outcomes for First Nations members
In a significant move towards reconciliation and inclusivity, Rest, one of Australia's largest profit-to-member superannuation funds, has unveiled its Innovate Reconciliation Action Plan (RAP)Read more
Superannuation
Payday super legislation promises fairer retirement for part-time and casual workers
In a landmark development for the Australian workforce, the recently passed Payday Super legislation is set to transform the retirement landscape for countless part-time and casual workersRead more
Superannuation
Payday Super passes as Employment Hero, OZEDI and Zepto unite to help small businesses meet new seven-day payment rule
With the Payday Superannuation Bill officially passing through Parliament, Australian businesses are now less than eight months away from a major shift in how superannuation contributions are made — ...Read more
Superannuation
Expanding super for under-18s could help close the gender super gap, says Rest
In a push to address the gender disparity in superannuation savings, Rest, one of Australia's largest profit-to-member superannuation funds, has called for a significant policy change that would allow ...Read more
Superannuation
Employment Hero pioneers real-time super payments with HeroClear integration
In a significant leap forward for Australia's payroll and superannuation systems, Employment Hero, in collaboration with Zepto and OZEDI, has successfully processed the country's first ...Read more
Superannuation
Rest launches Rest Pay to streamline superannuation payments and boost member outcomes
In a significant move aimed at enhancing compliance with upcoming superannuation regulations, Rest, one of Australia’s largest profit-to-member superannuation funds, has unveiled an innovative ...Read more
Superannuation
Rest appoints experienced governance expert to bolster superannuation fund
Rest, one of Australia's largest profit-to-member superannuation funds, has announced the appointment of Ed Waters as the new Company Secretary. Waters, who brings with him over 15 years of extensive ...Read more
Superannuation
Small businesses brace for cash flow challenges as Payday Super becomes law
With the new Payday Super legislation now enacted, small businesses across Australia are preparing for a significant shift in how they manage superannuation contributions. The law, which mandates a ...Read more
Superannuation
Rest launches Innovate RAP to support fairer super outcomes for First Nations members
In a significant move towards reconciliation and inclusivity, Rest, one of Australia's largest profit-to-member superannuation funds, has unveiled its Innovate Reconciliation Action Plan (RAP)Read more
Superannuation
Payday super legislation promises fairer retirement for part-time and casual workers
In a landmark development for the Australian workforce, the recently passed Payday Super legislation is set to transform the retirement landscape for countless part-time and casual workersRead more
Superannuation
Payday Super passes as Employment Hero, OZEDI and Zepto unite to help small businesses meet new seven-day payment rule
With the Payday Superannuation Bill officially passing through Parliament, Australian businesses are now less than eight months away from a major shift in how superannuation contributions are made — ...Read more
