Over $18 million was paid from superannuation funds to trade unions between 2013/14 and 2016/17 according to the Institute of Public Affairs, in a claim labelled by the ACTU as “wildly misleading”.
The Institute of Public Affairs (IPA) has released a report titled Rivers of Gold: How the Trade Union Movement is Funded by Industry Super. Analysis of public information in the report finds that over the last 4 financial years $18,438,516 was paid from super funds to trade unions as directors fees. This compares to $2,076,756 received by employer and industry groups and $5,633,099 by other third parties.
These payments are made to compensate an employer for the time spent by an employee in work for the industry super fund.
“Industry super funds are being used as a vehicle to transfer millions of dollars from hard-working members to the trade union movement,” said Simon Breheny, Director of Policy at the IPA.
“At a time when less than 1 in 10 workers in the productive sectors of the economy is a member of a trade union, it is clear the industry fund model has been very significantly undermined,” he said.
“Significant efforts should be made to stop members’ funds being funnelled from industry funds to the union movement.”
The Australian Council of Trade Unions (ACTU) says the report is “wildly misleading” and “politically motivated”.
“This is deeply offensive to the IPA. As the mouthpiece for the Liberal Party, this compromised report can only be seen as attempt to defend and distract from the big banks scandalous attempts to get their hands on workers’ savings,” said a statement by the ACTU following the release of the report.
“Representatives of employer organisations also sit on the boards of industry super funds. All directors on the boards of the same super funds are paid equally.”
“Employer fees are not included in this report, as they are retained by the employer representatives. As such, it presents a wildly misleading assessment.”
“The report artificially inflates director fees from 2013-14, 2014-15 to imply that payments were higher than actuals. This is a dirty trick, it discredits the report, and it demonstrates that it is only about the political defence of a lousy government.”
The ACTU is calling on the IPA to declare who funded the report and if there was any Ministerial involvement in its production.
“Today’s IPA report is another example of the secretly funded operation running political interference for the beleaguered government, who are internally divided over attempts to have a Royal Commission into big banks for ripping off customers, including their superannuation,” said the ACTU.
“This report is basically garbage. It is a political smear. If the IPA refuses to declare where the funding comes from, it should not be lecturing anyone on accountability.”
Industry Super Australia (ISA) says the claims by the IPA are “desperate”, “wrong” and “politically motivated”.
ISA says that less than 25% of total super fund director fees are paid to unions, and that a “balanced analysis would reveal average six figure director fees paid to directors on super funds run by the banks are 67% higher than those paid to Industry Super fund directors.”
ISA public affairs director Matt Linden said the report by the IPA was perfectly timed with Government attempts to pass a Bill in the Senate.
“It is deeply disturbing a debate about good governance in superannuation has been reduced down to the role of union representatives on super boards and grossly misleading analysis on directors’ fees,” he said.
“The real question is why the government’s bills fail to address the bank-owned retail super funds’ chronic underperformance and the channeling of billions of dividends at the expense of retirement savings.”