Banking royal commission scrutiny looms for industry super-backed The New Daily
The small, industry super-backed online publication The New Daily looks set to come under royal commission scrutiny.
The word on the street is that the free news site, which is published by a company associated with media entrepreneur Eric Beecher, has been targeted in the usual blitzkrieg of notices to produce documents ahead of the financial services royal commission’s public hearings on superannuation.
The hearings start on Monday.
The New Daily has generated controversy in federal coalition circles since it was set up in November 2013 as a joint venture between six industry funds.
In no particular order, they were AustralianSuper, HESTA, LUCRF, United Super, First Super and Cbus.
A restructure occurred about three years later, with an industry fund umbrella company, Industry Super Holdings, taking control of all 12 million shares in The New Daily for “nil consideration”.
ISH also owns the investment advisory firm Industry Fund Services and IFM Holdings, the global investment manager with $107 billion in funds under management.
The controversy relates to the obligation on not-for-profit funds to spend money in the best interests of members, and whether millions of dollars invested in a niche publishing venture discharges that obligation.
In the words of US President Donald Trump, the industry fund network believes it’s all a witch hunt, invoking the well-worn Trump technique of “whataboutism”.
Inquiries about funding arrangements for The New Daily often prompt a return question: “What about the scandals in the for-profit sector?”
To state the bleeding obvious, whataboutism will not deter royal commissioner Kenneth Hayne — or counsel assisting — from conducting a forensic investigation of the entire venture if he believes it’s warranted.
That’s because it would fit snugly into the commissioner’s terms of reference.
One of those terms authorises an inquiry into any use of retirement savings that “does not meet community standards and expectations, or is otherwise not in the best interests of those members”.
A thorough examination of The New Daily’s commercial arrangements would please the government and Financial Services Minister Kelly O’Dwyer no end.
O’Dwyer targeted “money sloshing around (the superannuation industry) for other cultural practices” in a speech last April.
Super fund members, she said, had to “stand by and watch as their retirement savings are spent on straight out political advertising”.
The minister also cited “dubious” sponsorships of union congresses, super liaison officers who were union officials paid out of super funds, and a lobbying outfit that stood in the way of the prudential regulator getting “important new powers to protect members’ funds.
O’Dwyer didn’t mention The New Daily, but you can bet the minister reckons it falls into the same category.
gluyasr@theaustralian.com.au
Twitter: @Gluyasr
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The odds are shortening that The New Daily — a small online publishing project backed by the industry superannuation fund network — will soon blast into the public consciousness in a way that belies its position as a peripheral media player.