New laws to shine more light on union super deals

Almost $1m in payments from TWUSuper to the TWU would be subjected to tough disclosure rules under new legislation.

Minister for Revenue and Financial Services Kelly O’Dwyer will tomorrow introduce a bill aimed at shining a light on opaque payments from super funds to third parties. Picture: News Corp

Almost $1 million in payments from industry superfund TWUSuper to the Transport Workers Union, which were listed as “other receipts”, would be subjected to tough disclosure rules under legislation being introduced this week.

Minister for Revenue and Financial Services Kelly O’Dwyer will tomorrow introduce a bill aimed at shining a light on opaque payments from super funds to third parties, including transfers from industry funds to unions.

The measures would have required TWUSuper — which has changed chief executives five times in four years — to disclose and justify to the Australian Prudential Regulation Authority all payments made to the TWU.

Under the shake-up, APRA would be given the ability to request the super fund reverse payments to third parties if it deemed them to go against the interests of fund members.

It is unclear from the TWUSuper financial statements what the $911,464 in payments in 2015-16 to the union were for, but The Australian can reveal only about 14 per cent of this sum went towards paying TWU-appointed directors’ fees.

Evidence of the payments can be obtained by an analysis of the TWU state branch annual returns lodged with the Australian Electoral Commission, although they are listed as “other receipts”.

TWUSuper chief executive Frank Sandy yesterday defended the appropriateness of payments made to the union as well as to other employer groups in a statement. He said the payments were for commercial services that “improve communication and interaction with both members and potential members, including event sponsorships, advertising in employee magazines, newsletters and websites (and) compensation for TWU superannuation services”.

The government bill would also cast light on whether TWUSuper still employs or funds “superannuation liaison officers” appointed by the TWU, an arrangement that saw the fund pay part of the officer’s wage. It was disclosed to the trade union royal commission in 2013-14 that the TWU billed TWUSuper $590,000 for work done by six such liaison officers.

The government crackdown is part of a concerted effort to clarify payments to unions, Employment Minister Michaelia Cash yesterday flagging imminent introduction of legislation aimed at preventing unions skimming from employee benefit funds.

Key crossbencher Nick Xenophon offered no direction on how his party would vote on the proposed legislation.