We all deserve a dignified retirement after a lifetime of work. Our union-won superannuation system works to make this a reality. But this right is currently under threat as for-profit banks try to take over workers superannuation and are using their big bank mates in the Liberal Government to help them.
The Banking Royal Commission has uncovered serious criminal behaviour by banks ripping off their superannuation customers. Bank run for profit super funds have charged people fees for no service, stole workers money and funnelled it to shareholders, and failed to refund bogus fees and charges.
Australian Unions believe banks have no place in super and should be banned from operating super funds.
Working people fought long and hard to secure superannuation for all Australians. Unions were leaders in establishing industry funds. They pioneered the low-cost, not-for-profit superannuation funds dedicated to putting the interests of members first.
Before universal super, less than one in four women and blue-collar workers had access to retirement savings. Universal super changed all of this. In 1991 working people agreed to forgo a national 3% pay increase. This would be put into a new superannuation system for all employees in Australia until 2002, when the level of compulsory super increased to 9%.
Now millions of working Australians are members of industry funds and these funds manage hundreds of billions of dollars of workers’ contributions.
Industry funds are governed by trustee boards that represent working people and their employers; they have sound investment strategies which include long-term investment in Australian jobs.
In contrast, for-profit retail funds are run for the benefit of wealthy shareholders and bonus-hungry executives, by teams of bankers who often put profit ahead of members’ needs.
During the Banking Royal Commission, banks were shown to charge dead people for financial advice; take the home of a blind pensioner; they repeatedly lied to regulators, gave financial advice that enriched them and ruined customers and forged documents.
The bank-owned funds have been involved in a whole raft of scandals. In June, the Commonwealth Bank agreed to pay a $700 million fine for breaching anti-money laundering and terrorism financing prevention laws. Before the settlement was reached, they were facing fines totalling more than $1 trillion. This came days after ANZ, along with global banks Citigroup and Deutsch Bank, had criminal cartel charges levelled against them by the Commonwealth Director of Public Prosecutions.
Bank scandals and rip-offs have cost Australian workers $480 million since 2015. Yet the Liberal Government wants to make our world-class industry superannuation system more like the banks. They have legislation currently before the Senate that would see more bankers and finance industry bosses put on the boards of industry super funds, diluting the representation of working people.
We know that industry super funds have delivered better average returns for members for 15 years, by returning profits to members not shareholders and by investing in job-creation projects. And we know that banks have failed in super, enriching shareholders, gouging fees and in some cases breaking criminal laws.
Banks need to be held to account and they should keep their hands of workers’ super. Working people built our world-class retirement savings system and it is up to us to defend, preserve and expand it for the next generation.