Larissa Waters (Queensland, Australian Greens) Share this | Hansard source

Senator McKim, as our Greens Treasury spokesperson, would normally be delivering this speech, but he's in lock-up this afternoon, so I get the gig.

It won't come as a surprise to anyone that the Greens won't be supporting this disallowance motion. However, this should not be interpreted as the Greens endorsing the new government's new regulations. Our view is that the previous government's regulations were no good, but the new government's regulations are not much better. We may well move or support a disallowance of these regulations before the statutory time period to do so has expired, but, as with all disallowance motions, we have a binary choice: we can either accept or reject a new set of rules for what information is provided by super funds in their annual member meeting notices.

The requirement of super funds to hold annual member meetings was legislated only three years ago, and the explanatory memorandum for that legislation spoke of:

… the importance of increased accountability through higher levels of engagement and effective communication between trustees and their members.

This portrays the logical fallacy sitting at the heart of this debate: the fallacy of free-market capitalism, where the only thing individuals need to do to optimise their financial position is to fully inform themselves so that they can act rationally in the market and maximise their returns. Except people don't spend the evening on the first Tuesday of each month pouring over financial statements! Also, on average, you're likely to get a lower return out of your super fund.

In 2019 the Productivity Commission reviewed the super system and found that not-for-profit industry funds performed better than for-profit retail funds. They found, secondly, that keeping your super in a default product was likely to yield a better return than if you chose to put your money elsewhere. That's the quintessential economic rationalists saying that most people were better off not playing the market, because their default super fund—usually a not-for-profit fund—was likely to do a better job of managing their money. But, even if we lived in a free market nirvana, neither the previous government's regulations nor the new government's regulations would provide anything close to useful information for people to make a rational decision.

Senator Pocock was tweeting about the lack of details on $140 million in expenses listed on AustralianSuper's AMM notice. Do we know what the $140 million means under the new government's regulations? Not really. Would we know what it means under the previous government's regulations? We would have had an itemised breakdown of the $140 million, but we still wouldn't have any context. Under both the previous government regulations and the new government regulations, the annual member meeting notices only give member details on their fund. Now $240 million is a big number, but it's always going to be a big number for AustralianSuper, because they are the biggest super fund in the country. They've got 2.3 million members. Would that information be provided under the old or new regulations? No. What about a benchmark of AustralianSuper's expenditure compared to other funds? Again, no.

The outgoing chair of APRA, Wayne Byres, who has been regulating super for the last eight years, provided a useful perspective in a speech he gave last week. He said:

Transparency has been key to increasing the discipline on trustees to ensure they are always managing members' money in their best interests. In saying that, I am not suggesting every single thing about a fund's operations must become public … pumping out reams of raw data is not going to be helpful. Information must be disclosed in a manner that is digestible and informative if it is to be useful.

That is exactly what the Greens would like to do in this situation: have meaningful transparency. We are in discussions with the government about developing a scheme to provide this, as the chamber already knows. In our minds, this would be an annual super transparency report, published by the regulator, APRA, that tables all of the relevant expenditure, including for political purposes and for profit, for all super funds, all in the one place. This would enable members to understand how their super fund rates. It would also enable institutional scrutiny from the media, NGOs and parliamentarians on expenditure by super funds and on profit-making by super funds, which is far more likely to bring about meaningful change than either of the regulations that we're choosing between today.