Calls to ban for-profit super funds

Incoming ALP senate candidate Tony Sheldon has promised to pursue legislation to ban for-profit super funds if elected.

Mr Sheldon, who stood down as the national secretary of the Transport Workers Union (TWU) in August to pursue a position in Parliament, told the Australian Financial Review that “retail funds have no place in superannuation”.

“There is a fundamental cultural difference between for-profit [funds] in this space in comparison with best return for members which is delivered by not-for-profit funds,” Mr Sheldon said.

“It raises the fundamental question – are they fit and proper to be in that space? Clearly they’re not.”

Mr Sheldon, who will soon step down from the TWU Super board, also explained that industry super funds should take a more activist view of their duties to battle corporate tax avoidance.

“As super funds, we have to be raising the question, should we engage with companies that are involved in wage theft? Should we be engaging companies that are tax rorters?”

Mr Sheldon explains that a “holistic interpretation” of trustee obligation under superannuation law would mean looking at the effect of tax avoidance, leading to less government revenue, which means members will be denied access to health and other services in future years.

He also said that companies that worked to lower their wage bills would mean that members with poor pay would have less retirement income later.

Mr Sheldon has the No.1 spot on the NSW Labor senate ticket for the next election, guaranteeing him a seat, and has used his position to push for more ethical behaviour from companies before.

Last year, he lobbied industry super funds to withdraw investments in cargo-handling company Aerocare, which was involved in a dispute with the TWU over wages and conditions.

“We need to take responsibility for how our money is invested and what effect those investments will have on members now and in the future,” Mr Sheldon said.

Mr Sheldon said the job of super trustees was not just to ensure dignity in retirement, but a dignified path to retirement.

What do you think? Should for-profit funds be banned from competing in the superannuation marketplace? Should super funds take a more activist stance to push for higher wages and less corporate tax avoidance?

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Written by Ben

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