COSBOA has raised concerns about the culture of the superannuation industry, where it believes many director positions appear to be “sinecures” for people from unions and big business associations.
Executive Director Peter Strong said COSBOA has noted the Electrical Trades Union is facing an internal legal battle of who receives the money for directors jobs on some industry super funds.
“Small business people collect over $30 billion every year and send it off to super funds for no financial return for our time or effort and then the unions fight over who gets some of the money. Small business people are major stakeholders in an efficient superannuation industry and we want to know where is the governance and where is the focus on the members?”
Strong said his organisation has completed research into the people who hold positions on superfund boards, and found unions and big business associations have many employees and stakeholders as paid directors.
“And in many cases, the directors fees go to the union or the association. It seems that double standards are being applied here: it’s okay for us to be involved in the super industry for no pay but not for them.”
As a result, COSBOA believes employers should not be required to collect and distribute super funds, as it adds complexities to the system that create inefficiencies and “as a result, the earnings of members are decreased.”
“The whole superannuation management process and governance needs a review and a shakeup, some of the annual reports are very informative but many lack information and that needs to improve,” Strong said.
“Many of the funds are very inefficient in their record keeping and this wastes the time of small business people who have to fix problems created by the funds … if it is okay for union and business association people to get paid for their role in the industry then it is also okay to pay small business people for collecting that money.”
