Cbus chair Wayne Swan says ‘sorry’ for delays in super payouts

Former federal treasurer-turned-chairman of super fund Cbus has personally apologised for delays in disability and death payments.

Cbus chairman Wayne Swan has apologised on behalf of the super fund as Australia’s financial watchdog launches a landmark legal claim for delays in disability and death payments.

Mr Swan, Australia’s former treasurer from 2007 to 2013, attributed the delays to an offshore third-party operator responsbile for processing the payouts.

“But we are ultimately responsible for that, and we accept that responsibility,” Mr Swan told the Today show on Friday.

“We’re sorry it happened and we’re determined to ensure it never happens again.”

Mr Swan added: “I do accept complete responsibility for it.”

The CFMEU’s super fund has forced thousands of grieving widows and seriously injured workers to wait more than 12 months for payouts from their insurance scheme.

Former Treasurer Wayne Swan, the Cbus chair, has overseen the operations of the fund’s board during the disaster. Picture: Liam Kidston

More than 10,000 CBUS Super members have been forced to endure “unacceptably long” processing times, allowing the fund to hold on to more than $1 billion worth of claims.

Cbus Super has blamed staff shortages at an outsourced firm on the bungle.

Australia’s financial watchdog, the Australian Securities and Investments Commission, launched a landmark legal claim in the Federal Court on Tuesday afternoon after becoming fed up with the $94 billion fund’s excuses.

Mr Swan, the Cbus chair, has overseen the operations of the fund’s board during the disaster, which has left some widows distraught and in severe financial distress.

ASIC will claim that 11,000 death and disability benefit claims remain outstanding.

Of those claims, at least 6300 were more than a year old.

Cbus was formed in 1984 when construction and building workers won the right to superannuation and established BUS and AUST (later merged to form Cbus).

ASIC also says nearly all the claims – 10,000 – had not been processed within 90 days compared with an industry benchmark 60-day turnaround.

Cbus boasts on its website that it has been “supporting our members” for 40 years, and spruiks its insurance policies.

“Everyone with insurance hopes they never have to use it. But it’s good to know you and your family will be looked after if anything happens,” the fund says.

But the court case will allegedly show that Cbus has failed to address the issue for years, despite being told by ASIC that it was under investigation.

Cbus has been the default fund for the building industry, and has also recently acquired Media Super, taking over the investment for many of the nation’s journalists.

The fund has been a cash cow for the militant CFMEU, handing the union $1.25 million in the 2022/23 financial year.

Former CFMEU secretary John Setka.

Former CBUS Super board member Dave Noonan.

Three former CFMEU officials, Rita Mallia, Jason O’Hara and Dave Noonan have been moved on from the CBUS Super board after the union was put into administration amid claims of criminal infiltration.

They are not accused of any wrongdoing and the union has denied the claims.

Former Victorian branch secretary John Setka quit over the backlash from the allegations but has not been accused of any wrongdoing in relation to Cbus.

Former NSW secretary Darren Greenfield, who is fighting bribery charges in court, was stripped of his role.

Cbus has yet to disclose full details of how much money was outstanding as part of its claim delay debacle.

Rita Mallia and Darren Greenfield addressed a CFMEU protest rally in August. Picture: Max Mason-Hubers

But last year it paid out an average of $105,000 to 3,629 members, with a total insurance payout of $384 million.

Based on those figures, the 11,000 outstanding claims at an average of $105,000 payouts were worth more than $1 billion.

Cbus has acknowledged their “unacceptably long delays in the processing of insurance claims and certain claims communications from us”.

The fund said in a statement on Tuesday that “Cbus Super is sorry that delays have been experienced in the processing of insurance claims made by our

members.”

“Regrettably this has added to the distress of members and their families,” the fund said.

“We apologise to our affected members and their families without reservation and promise to do better.”

The fund also revealed that it had set up a “compensation program for affected members which is being implemented now.”

“Cbus has been co-operating with ASIC during its investigation and notes that ASIC has today commenced proceedings in the Federal Court,” the fund said.

“Cbus will invite ASIC to engage in alternative dispute resolution processes

to avoid protracted litigation.”

Originally published as Cbus chair Wayne Swan says ‘sorry’ for delays in super payouts