September 18, 2020 — 6.45pm
Assistant Minister for Superannuation Jane Hume has lashed out at industry super funds, saying their role is not to create jobs, rebuild the economy or get involved in the climate debate but to bolster retirement incomes for workers.
In a sign of mounting frustration between industry super funds and the federal government, Senator Hume accused Industry Super Australia of being “noisy” and “belligerent” and said it did not represent the views of some of its own member funds’ bosses.
Industry Super represents 15 industry funds, including AustralianSuper, CBus, HESTA and HostPlus, that collectively hold the retirement savings of 5 million members. Since June, HESTA, CBus and UniSuper have all revealed plans to cut carbon emissions to zero by 2050.
“Some of these funds have got very big and very influential and they seem to forget their job isn’t to rebuild the economy or create jobs or reframe the climate debate or require industrial relations changes at companies they invest in,” Senator Hume said, adding the industry super sector accounted for about 40 per cent of accounts in the $3 trillion superannuation system.
Treasurer Josh Frydenberg said in June that retail and industry super funds should take a bigger role in local infrastructure investments. Industry Super and several fund CEOs responded by saying stable policy settings, including around the super guarantee rise, would be needed to ensure long-term investments could be made.
Industry Super chief executive Bernie Dean said he wanted to talk to the government about how to build a better future for members, but “instead of projects, pipelines and partnerships we’re getting petty point scoring” and “name-calling”.
He said the sector had advocated for reforms to drive down fees and end conflicted remuneration models and would “not stop”.
“We have supported the Prime Minister, Treasurer and assistant minister in their repeated promises on super and we want to work with them to get sensible changes up that will boost member savings, get the economy moving and stop that ticking time bomb of our ageing population,” he said.
Industry Super has called individual MPs “hypocrites” for opposing a rise in the superannuation guarantee from 9 per cent to 12 per cent by 2025. The Morrison government is still considering the future of this legislation but the lobby group has warned a backflip on the rise would put at risk a $33 billion pipeline of investment from the funds over the next five years, which would help generate jobs and revive the economy.
Senator Hume said many industry super CEOs and chairs “roll their eyes at the weird, shrill militancy of their lobby groups” in conversations with her.
“It’s only the industry super lobby [out of the superannuation system] which is by far the most noisy, most belligerent, most resistant to change or improvement and they are also by far the most well-funded lobby group around,” Senator Hume said.
The super funds have also been critical of the federal government’s decision to allow struggling workers to access up to $20,000 from their retirement nest egg at the height of the coronavirus pandemic and have warned any moves to extend this will be met with resistance from the industry. So far $33 billion has been withdrawn from super accounts.
Industry Super has raised concerns about ineligible applications to the scheme and launched a marketing campaign online about the effects on retirement balances of withdrawing the money early. The marketing prompted Liberal senator Andrew Bragg to write to the Australian Prudential Regulation Authority criticising the actions as undermining government policy.
Australian Institute of Superannuation Trustees boss Eva Scheerlinck warned industry members about “detractors in Canberra” last week.
Originally published by The Sydney Morning Herald