Union warchests lined by super funds
Industry funds have funnelled more than $114m into union coffers since mid-2006, and almost $10m was pocketed before the 2022 election.
Cashed-up industry super funds have funnelled more than $114.5m into the coffers of trade unions since mid-2006, according to Australian Electoral Commission data showing unions pocketed almost $10m in the lead-up to last year’s federal election.
The militant CFMEU has been the biggest beneficiary of super fund income streams, banking $4.47m in 2021-22 and $33.65m over 16 years.
The AEC declared payments data, compiled by NSW Liberal senator Andrew Bragg, comes after the Australian Prudential Regulation Authority in May confirmed it had launched a formal investigation into millions of dollars flowing between industry super funds and unions.
APRA, the independent statutory authority overseeing banks, insurance firms and super funds, said it was prepared to enforce legal action against industry super funds if its probe found payments were not in the financial interests of members.
Industry Super Australia, which represents the top industry funds, on Wednesday said all spending by industry funds was governed by the “best financial interest duty”.
“(This) includes payments to third parties for services rendered on commercial terms such as director fees, sponsorship, marketing arrangements or returns on investments. ISA funds don’t make political donations,” ISA chief executive Bernie Dean said.
“In peddling incorrect figures about industry super funds for the third time this year, Mr Bragg shows he’s incapable of moving on from the super wars.”
The Coalition, which will move to amend Financial Services Minister Stephen Jones’ objective of superannuation bill, has in recent years raised concerns that super fund payments to unions indirectly supported ALP campaign warchests.
The United Workers Union, formed in 2019 after the merger of United Voice and the National Union of Workers, received more than $1.1m in payments in 2021-22. Other recipients include the Transport Workers Union ($846,000), Australian Manufacturing Workers Union ($675,000) and the ACTU ($568,000).
Cbus, Hostplus, FirstSuper, TWUSuper and Australian Super top the list of super funds making payments to unions.
Assistant Treasurer and Financial Services Minister Stephen Jones said “superannuation funds making any payments for service, should be made in the best financial interest of members”.
Senator Bragg, chair of the parliamentary economics references committee and deputy chair of the economics legislation committee, said “super funds are retirement homes for Labor politicians. They are also cash cows for unions and Labor. Outrageously, super funds made $10m in political contributions to unions last year. These payments should not occur if they are not in the best interests of members.
“Given the persistence of these dodgy payments, we might need even clearer laws.”
Senator Bragg said he would seek to amend Mr Jones’ bill to “ban these payments if super regulator APRA doesn’t act beforehand”.
Speaking at a Senate Estimates hearing in May, APRA chair John Lonsdale said the regulator was prepared to take action against certain entities.
At the hearing, APRA deputy chair Margaret Cole said investigators were looking into Australian Electoral Commission transparency register disclosures and whether payments made were value for money for members.
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