More industry fund bashing by Lib backbenchers

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Do we need to have to change the Government to get any sense from try-hard politicians? Tim Wilson MP has grabbed onto the coattails of the likes of Senator Andrew Bragg, last week suggesting HostPlus has a “conflict of interest” because it invests in infrastructure assets through a company in which it has a shareholding – IFM Investors. Who doesn’t?

Presumably Tim is aware that a lot of big super funds, like their international counterparts, also have internally managed investments on behalf of members. What’s the difference? And doesn’t having a shareholding in your investment manager give you extra clout as a client? Following the nonsense sprouted by the 36-year-old NSW senator, Bragg, a former accountant, fellow Liberal backbencher Tim Wilson let it be known last week, that he’d written a letter to APRA asking for an investigation into the investments of HostPlus. Apparently, none of the other 100-odd not-for-profit clients of IFM, one of the world’s largest infrastructure investors, needed any attention. What is going on?

Andrew Bragg also likes to make headlines by bashing industry funds. Heaven knows, he’s not going to get much press any other way. Bragg has been the most vocal of Coalition parliamentarian critics of not-for-profit funds. Since the COVID-19 crisis he has argued that “industry funds”, not other not-for-profits, have liquidity issues because of their higher exposure to unlisted investments than the bank-owned funds. He then sent emails to the citizens of NSW advising them that they could withdraw up to 20 per cent of their super without question in the current climate, just in case we’d missed that news. Before gaining senate pre-selection last year, Bragg was a policy manager at the Financial Services Council funds management and insurance lobby group, followed by short stints at the Menzies Research Centre and then as executive director of the Business Council of Australia. He failed in a bid to gain pre-selection for the very safe Liberal seat of Wentworth.

According to a report in ‘Investor Daily’ last week, Wilson’s letter to APRA chair Wayne Byers said: “a conflict of interest by the fund, a failure to sufficiently spread risk, and secrecy when such problems are identified” were among the issues which concerned him.

Wilson, who is also chair of the House of Representatives standing committee on economics, asked that APRA conducts a review into the fund as well as an examination across the industry super fund sector, to ensure there is “proper diversification of risk and that conflicts of interest are managed”.

“It is my conclusion that IFM Investors [seems]to believe as they are ‘one step removed’ from the funds that receive the compulsory retirement savings of Australians, that they are ‘above’ the scrutiny and transparency justified for oversight of Australia’s retirement savings. I do not share this view. Considering the exposure many industry funds have to IFM Investors their secrecy is disturbing.”

Investor Daily reported: “APRA is yet to respond to the letter, with a spokesperson telling Investor Daily on Wednesday it would be replying directly to Mr Wilson.”

Wilson is a Victorian MP first elected in 2016 to the seat of Goldstein. Goldstein is a Melbourne bay-side electorate running between the suburbs of Elsternwick and Beaumaris. Openly gay, he campaigned in favour of legalising same-sex marriages prior to the electoral survey of voters in 2017. Before entering parliament he was Australia’s Human Rights Commissioner. Last year he marched with anti-government protestors in Hong Kong to show his support. So, he’s not an arch conservative. Maybe it’s just the Liberal Party line.

– G.B.

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