New Turnbull government legislation pushes the commercial interests of the big banks.
Superannuation bills introduced by the Coalition government into federal parliament will, if passed, help banks
get their hands on working people’s superannuation.
The bills are designed to shift control of workers’ super from the not-for-profit industry funds, which have represented them for decades, to the banks.
Banks already rake in huge fees from the retail super funds they control.
In 2016, $8.7 billion in fees flowed from retail super customers to the big banks, according to a report by Rainmaker Consulting in May.
It found that industry and company super funds accounted for 42 per cent of funds under management and received 42 per cent of all fees, while retail super funds had only 29 per cent of funds under management but received 50 per cent of all fees.
NSWNMA General Secretary Brett Holmes says there would be no benefit for nurses in moving their super from industry funds to the banks.
He says that despite charging higher fees, retail funds continue to underperform the non-profit sector.
“Past returns have always shown that industry funds out-perform for-profit, bank-owned funds.”
Monthly data from SuperRatings shows, on average, industry super funds outperformed bank-owned super funds by more than 2 per cent a year during the 10 years to 30 June 2017.
The government bills are designed to reduce the representation of workers on superannuation boards, make it harder for workers to bargain for industry funds, politicise the independent regulator and give it powers over industry funds that the big banks aren’t subjected to.
The bills would force industry funds to adopt the same sort of board governance structure as banks and the super funds they control.
This is despite the fact the banks are plagued by scandal and industry funds generate better returns.
“Superannuation should be not-for-profit, and banks should not be allowed any more control over super,” Brett says.
Bank Super scandals
Strong returns for low fees
Australian unions won industry super-annuation for all Australian workers through a series of campaigns from the 1980s.
Industry funds have a 50/50 split of employee and employer representatives on their boards, which gives working
people a say in how their super is managed and invested.
Economics commentator Bernard Keane describes it as “a hugely successful model that contributes more than a third of Australia’s vast $2 trillion-plus savings pool and earns strong returns for low fees. It’s a credit to both corporations and unions that they’re able to oversee such a successful sector.”
You'll automatically become a member of the Australian Nursing and Midwifery Federation