Industry Super Australia has launched a new attack campaign on the banks and their “attempts to dismantle the model used by the most successful part of the superannuation system, and put at risk the retirement savings of millions of Australians”.
The campaign, called ‘Banks aren’t super’, includes a TV ad depicting federal politicians opening the superannuation hen house for the waiting, ‘bank’, foxes.
“The commercial responds to bank attempts to secure unfettered access to Australia’s default superannuation system for those who don’t choose their own super fund,” said Industry Super Australia.
“To achieve this, government would be required to dismantle the Fair Work Commission’s merit-based process of shortlisting workplace default funds for employees who are otherwise disengaged from the super system.”
“These mostly not-for-profit default funds consistently outperform the retail super products sold by banks and others, ultimately leaving their members in a stronger financial position at retirement.”
Industry Super chief executive David Whiteley said: “The banks are quietly pressuring federal politicians to remove the laws that protect Australians who save through workplace default funds.”
“Not-for-profit industry super funds have consistently outperformed bank-owned retail funds by almost 2 per cent per year over the past twenty years,” he said.
“If the banks succeed in bringing the default system down, the super savings of millions of Australians could be at risk.”
Industry super funds and retail super funds are locked in an ongoing battle over the setting of default funds and super fund governance. The Productivity Commission is due to issue a draft report on alternative models for setting default super funds by the end of the month. The Federal Government has also reiterated its commitment to changing the super fund governance rules.
Another union scare campaign wasting members’ super: Kelly O’Dwyer
Minister for Revenue and Financial Services Kelly O’Dwyer has labelled the advertising campaign by Industry Super Australia as “just another example of union-backed industry funds using members’ superannuation savings to bankroll political activism”.
“This campaign is jumping at shadows. There is currently no government legislation designed to change the default superannuation model before the Parliament, so the whole basis of the campaign is bizarre,” Minister O’Dwyer said.
In February 2016 a joint statement by Treasurer Scott Morrison and Kelly O’Dwyer, then Minister for Small Business and Assistant Treasurer, announced that the Productivity Commission had been tasked to”develop alternative models for a formal competitive process for allocating default fund members to products”.
Minister O’Dwyer today said the ISA campaign, if it was designed to pre-empt the Producitvity Commission report, was “another example of trying to shoot down an independent government body”.
“But the main problem is, this is not how members’ superannuation savings should be being spent,” said Minister O’Dwyer today.
“It is beholden on industry super funds, which bankroll ISA using members’ retirement savings, to disclose to their members how much they have contributed to this latest round of self-indulgent scare campaigning and lobbying.”