Keep bank ‘foxes’ out of the super henhouse, new campaign warns

Posted: Monday 20 March, 2017

A powerful new campaign warns industry super members and consumers of bank 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.

At the centre of the Industry Super Australia campaign is a 30-second television segment which depicts the hand of a federal politician opening a hen house to waiting foxes. The tagline is “Banks aren’t super”.

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.

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[1]”.

“If the banks succeed in bringing the default system down, the super savings of millions of Australians could be at risk,” he said.

Research conducted ahead of the campaign shows strong public distrust for banks when it comes to super.

“The 5 million Australians who entrust their savings to an Industry Super fund expect us to call out exactly what the banks are up to - and our politicians to stare them down,” said Whiteley.

The advertisement broadcasts from Monday 20 March, 2017. View it here

In 2016, the federal government tasked the Productivity Commission with exploring alternative ways of allocating default super fund products. The Commission’s baseline is for a system with no defaults. A draft report is expected in the coming fortnight.

The government has also vowed to reintroduce a bill, defeated by the senate in 2015, that will change the way not-for-profit super funds are governed so they are more like the banks.

 
David Whiteley is available for interview. Media contact: Phil Davey 0414 867 188



[1] Source: ISA analysis of APRA Superannuation Statistics