Superannuation reforms back on Senate agenda

Superannuation reforms have been elevated as the government’s policy priority when the Senate sits next week.

Stirling Griff. Picture: Emma Brasier

Superannuation reforms aimed at introducing greater independence and accountability to the boards of all superfunds have been elevated as the Turnbull government’s policy priority when the Senate sits next week.

The fate of the reform package — which would mandate independent directors on fund boards — could be decided today when the Nick Xenophon Team meets to thrash out a position on the shake-up.

The plan, championed by Financial Services Minister Kelly O’Dwyer, would bring superfunds into line with companies by introducing annual member meetings and ensure one million more employees on enterprise agreements are able to choose their own super provider.

It would also give the Australian Prudential Regulation Authority more scope to take action if a fund failed to act in the best interests of members while forcing it to report more transparently on how it was managing funds.

The NXT controls three upper house seats with senator Stirling Griff telling The Australian yesterday: “We have not yet adopted a formal position on the government’s superannuation legislation. Discussions will be taking place (Friday) morning.”

Nick Xenophon helped block the government’s 2015 attempt to introduce the one third independent director requirement in favour of a review by former Reserve Bank governor, Bernie Fraser.

The changes would challenge the independence of the industry superfund model, which relies on having equal numbers of trustee directors from employers and unions. For example, the South Australian based industry-fund Statewide Super in March took on former Labor senator Anne McEwen who was appointed by the Australian Services Union as a “member representative” and Alex Overley, a former speech writer for Labor Premier Jay Weatherill, appointed by the Australian Workers Union.

The independent chair of the super fund, Kenneth Williams, was initially appointed to the board as an independent director by the ASU in July 2012.

Statewide Super said yesterday that “not less than four of the current directors would be considered ‘independent’” under the government’s shake-up.

“We do not anticipate any changes will be required by Statewide Super in relation to the new super reforms,” it said.