A key architect of the compulsory retirement savings system lauds its many achievements, stretching from the national economy to the individual. Where it’s double faulting is in serving members – and it needs to be addressed promptly.
With performance and diversification driving demand, these funds are expected to experience four-fold global growth over the next decade to nearly $AU65 trillion.
Thank heavens for ham sandwiches
by Greg Bright
From the genesis of universal super in 1986, with the ‘Accord’ between the Hawke-Keating Government and the ACTU, the industry has always been political. The more money in the pot the more political is the daily noise. Right now, with a federal election looming, it doesn’t get much more political than this.
The big fight is over negative gearing, with Labor wanting to overturn the Howard Government’s relaxation of the rules and get back to what Keating introduced. The funds management industry has been a vocal critic of Labor’s proposal, particularly Geoff Wilson, rather embarrassingly, and Don Hamson who is a firm believer in the economic good that results from the existing law.
Some Labor Party officials are wishing that their leader, Bill Shorten, would keep his mouth shut. This election is right there for the taking – or his to lose. But there are lots of other bits and pieces coming through, no matter who wins the election. They are called ‘reforms’. When did that happen? When did every legislative change become a ‘reform’ rather than a legislative change?
Two upcoming speeches from within the industry are worth noting, given the charged environment. Ian Silk, the chief executive of AustralianSuper, is delivering the first keynote address to the Conference of Major Superannuation Funds on March 13. He has been given a wide brief: ‘The Future of Super’. And former Senator Nick Sherry, Australia’s first minister for superannuation, is focusing on the likely changes ahead for the next three-five years, in a speech to seminars being organised by Northern Trust for Sydney and Melbourne in early April. The annual ASFA budget lunches in Sydney, Melbourne, Brisbane, Perth and Adelaide this year, also in early April, should be livelier than usual.
While Ian Silk can be expected to be measured in his comments, given his job, Sherry is less constrained. He is the executive chair of the systems company FNZ but is still active in Labor Party circles. Sherry’s knowledge of the super system, when he was minister and subsequently, is probably superior to that of any other politician. It was always a delight to see him welcome and field questions at various industry events, often explaining the intricacies of technical super regulations.
The great investor Warren Buffet is famous for his quaint turns of phrase. He once said he liked to invest in countries which were “like a ham sandwich”. Even a very bad cook would fund it difficult to muck up a ham sandwich. Governments, too, can’t do too much damage in ham sandwich-type countries, such as Australia one hopes.
For the record, Sherry is predicting a Labor Party victory federally. He is less sure of a Labor victory in the NSW State election. Silk will probably be keeping his own counsel on the outcome.
