The Your Future, Your Super reforms will compel funds to demonstrate that there was a “reasonable basis” to support their actions being consistent with the best interests of members. In theory, that means no more donations to political fundraisers or big spending on sporting events.
But answers to questions on notice provided by a number of super funds, industry and otherwise, have shown that there’s not much to see.
Sunsuper achieved some notoriety when it paid nearly $11,000 to the Queensland Labor Party to sponsor a corporate breakfast last year. But while APRA believed that amount was “immaterial” within the context of the fund’s $60 billion in FUM, its other payments have been even smaller – two $80 payments to take part in Business with Labor events. HESTA, Hostplus, and Rest have all denied spending on political fundraisers.
Over the last decade, IFM Investors (an investment manager owned by 27 super funds) purchased tickets to a grand total of three events organised by the Labor Party – one in 2010 and two in 2013. And while it’s fair to ask questions about the price of those tickets (Anthony Albanese recently hosted an exclusive dinner with tickets going for around $5,000 a pop), it’s unclear whether those volumes are significant enough to justify more than a rap across the knuckles. Industry Super Australia also maintains that it doesn’t make political donations.
A recent and somewhat puzzling line of questioning taken by a number of Coalition MPs in recent hearings was whether funds maintain art collections – a question that has also been met with a resounding no in answers to questions on notice. Meanwhile, Hostplus’ indefensible annual splurge on the Australian Open apparently ended in April 2019 with amendments to section 68A of the Superannuation Industry (Supervision) Act 1993.
More glaring is the matter of advertising. Rest spent some $4,958,953 of members’ money on advertising and media in financial year 2019 – a cost that shakes out to roughly $2.50 per member. But while this might fail some readings of the sole purpose test, funds would dispute that they have no need to advertise.
However, the elephant in the room remains. Industry Super Holdings (ISH) still refuses to divulge how much it spends on the loss-making New Daily despite a grilling from the standing committee on economics (however, the holding company had no art collection and had not bought tickets to sporting events or fundraisers). But the efficacy of the reforms in this area would appear limited by the fact that ISH isn’t a fund, and while funds could be compelled to provide more information to members on how much money they give to ISH, ISH sees its handling of that money as a confidential matter.
While the reforms create many welcome changes in the superannuation industry, it remains unclear how much of an effect these new disclosure rules will have.
Vertically Integrated Industry Super needs a full investigation. And not by their best buddies ASIC.
– From the 93% Growth Assets so called “Balanced Funds”.
– General Advice / Product Sales by call centre jockeys acting as Advisers with zero qualifications or compliance.
– Intra Fund Advice / Sales paid for by Hidden Commissions = Fees for no Service to most members.
– Majority Investments in Vertically Integrated Asset Managers, more hidden fees and commissions.
– Administration Providers Vertically Owned and the big wig directors cleaning up the profits.
– Hidden Life Insurance Commissions paid in huge way via Access Fees to the Industry Funds.
But ASIC will never do anything against Industry Super.
A complete rort from the Top down.
[b]Industry Super = Modern Day Union Corruption, dressed in nice suits. [/b][b][/b]
The issue with New Daily is not just how much members’ money is spent on it. It’s the fact that union super funds use members’ email addresses as a distribution list for this unsolicited union propaganda.