The Government has been accused of politicising APRA, after it was revealed the regulator had met with crossbench senators to discuss proposed changes to superannuation fund governance currently before the Parliament.
APRA Member Helen Rowell revealed in a Senate Economics Legislation Committee hearing that the Government had asked the regulator to meet with crossbench senators.
Mrs Rowell recently gave a speech rejecting “fallacies” around the proposed governance changes, which will require at least one-third independent directors and an independent chair.
ALP Senator Chris Ketter, in the committee hearing, asked Mrs Rowell:
Senator Ketter: And can you tell us who you’ve been speaking with?
Mrs Rowell: I participated in meetings with some of the crossbench senators.
Senator Ketter: In relation to the meetings with the crossbench senators, were those meetings occurring at the request of the crossbench senators, at your own instigation or at somebody else’s instigation?
Mrs Rowell: APRA was asked by the Minister’s Office if we would make ourselves available to answer questions to anyone who wanted to ask questions or get clarification on aspects of the Bill.
“The Turnbull Government should not be using APRA as a tool to argue its political case,” said Shadow Minister for Financial Services and Superannuation, Jim Chalmers.
“The behaviour of the Assistant Treasurer politicises APRA and risks bringing into question the independence of Australia’s financial regulator,” he said.
“From the beginning this has been an unnecessary and poorly-conceived ideological crusade against representative super boards from a government which has changed leaders but which hasn’t changed its ways.”
Mrs Rowell was also unable to point to evidence that independent directors would lead to higher returns for super fund members:
Governance is in some ways difficult to measure the outcomes of, and I think, whilst there are some studies that point to enhanced performance that can be attributed to independent directors, there’s also qualitative research that supports that view. From APRA’s perspective what is important is the quality and rigour of decision-making and the review that is applied to making decisions – whether it’s about arrangements with service providers, fees that are paid by members, or indeed, investment decisions. Again our view is that the breadth of skills and the quality of challenge that occurs when there are independent directors on boards is much greater and therefore that does lead to decisions which ultimately does have benefits for members. But it is very difficult to put any quantitative measure of those benefits.
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