Treasurer Frydenberg has met his October budget promise by introducing the controversial Your Future, Your Super reform package to Parliament on Wednesday, despite fierce opposition from the super sector with Industry Super Australia (ISA) threatening to spend millions on campaigns opposing the planned changes.

The package, if legislated, will introduce an annual performance test and a public ranking by the Tax Office, with funds that fail to pass expected to be banned from accepting new members from July this year.  

According to Treasury, the Your Future, Your Super reforms make the super system “better for members” in four key ways – preventing the creation of unintended multiple super accounts, helping members choose well-performing products that meet their needs, holding funds to account for underperformance and increasing transparency and accountability.

Together, the Treasury estimates, these changes should save Australians over $17.9 billion over 10 years.

But the super sector disagrees.

Uniting against the government’s proposal, ISA has threatened to launch an advertising campaign to warn members of the dangers.

According to ISA, Your Future, Your Super will be the government’s “greatest gift” to the big banks and the for-profit super sector by allowing them to “skim” up to $10 billion a year in profit.

ISA’s claims are hinged on the package’s apparent disregard for the excessive fees charged by the for-profit sector, among other things.

The ACTU agrees, noting last month that “if these laws are passed, for-profit funds will have a systemic advantage over all-profit-to-member funds, leaving workers worse off”.

“If these proposals become law, from 1 July 2021, all people with an existing superannuation fund will be stapled to their current fund, meaning predatory for-profit funds will target first-time bank openers to nominate a super account with them, locking them into a poor-performing default fund for life,” the ACTU said.