Cbus boss plans for more mergers

The $55bn industry superannuation fund backs legislated plans to increase the superannuation guarantee.

Justin Arter urged the federal government to not abandon legislated plans to increase the superannuation guarantee from 9.5 per cent to 12 per cent from the middle of next year.

New Cbus chief Justin Arter said the $55bn industry superannuation fund would look at more merger candidates when it had completed the $8bn Media Super deal in the first quarter of next year.

Arter was speaking on his eighth day running the industry fund after replacing long-time boss David Atkins late last month. He also urged the federal government to not abandon legislated plans to increase the superannuation guarantee from 9.5 per cent to 12 per cent from the middle of next year.

“There will always be a reason not to stick with the commitment but it is hard to see a 0.5 per cent increase having an impact on employment,” he said.

Arter backed reported comments by former NAB chair Ken Henry who said: “People can always argue that it’s never the right time to increase the rate of the superannuation guarantee. I would say this is long-term structural reform.”

But Future Fund chair Peter Costello indicated he was in favour of deferring the increase, saying on Wednesday “everything needs to be assessed in light of conditions”. Asked about the impact on the superannuation industry of any delay he replied: “When you have a guaranteed 9.5 per cent of people’s wages coming into the fund there is very little that can go wrong.” The proposed increase has been delayed twice before — in 2009 by the Gillard government and in 2013 by the Abbott government.

IOOF’s Renato Motto is also in favour of deferring the increase again due to the weak pandemic-affected economy.

Arter said it was important to stick to the plan “because it enables the funds to invest with some certainty”.

After an early career in stockbroking with McCaughan Dyson and Goldman Sachs, he ran Victorian Funds Management Corporation for three years before becoming the local head of BlackRock in 2012.

He was then promoted to a London-based job running institutional clients for the funds management giant. Arter returned to work with ANZ for two years before taking the Cbus role last month. He said he was attracted to the “good systems cultures and values at Cbus”.

Arter rejected criticism of investments in industry fund institutions like IFM, ISPT and ME Bank.

“They save a lot of fees and are good for members,” he noted.

Regarding Media Super, he said “the merger fund talks are proceeding well”, and promised to maintain Media Super’s focused interests once the deal was completed. Media Super covers a wide group of interests from printing unions to film producers, journalists, actors and musicians.