A REVIEW of the non-profit superannuation industry led by Bernie Fraser and announced with huge fanfare by the union movement last year is set to sink without a trace if Labor wins power.
Mr Fraser, a former Reserve Bank governor, was appointed to find evidence against the government's plans to dilute the power of unions within the nation's $2.3 trillion superannuation sector.
The review's industry super fund sponsors have succeeded in delaying a planned shake-up of their boards until after the election. Labor will throw out the changes if elected.
Outgoing Association of Superannuation Funds of Australia boss Pauline Vamos ruffled feathers among her non-profit stakeholders by supporting reforms to force more independence on boards. Photo: Rob Homer
What was a hot-button political issue has gone silent amid the brouhaha over changes to superannuation taxes announced in last month's budget.
Submissions to the Fraser Governance Review closed on February 1 and the consultation period ended on April 30. The report was originally expected by May 31.
"Mr Fraser has advised that the release of his report and recommendations will be deferred until after the election to ensure appropriate consideration of its findings," an Industry Super Australia spokesman told The Australian Financial Review.
"Mr Fraser has made contact with the relevant crossbenchers to advise them of this development."
The industry-funded review is the outcome of a deal struck with senators Jacqui Lambie, Glenn Lazarus, John Madigan and Nick Xenophon in December.
No update to government
Industry Super Australia (a lobby group for 15 industry super funds), and the Australian Institute of Superannuation Trustees (the peak body for the non-profit super sector more broadly including government and corporate funds) promised to jointly commission Mr Fraser to review governance standards in the sector.
This promise to consider options for better self-regulation was enough to convince the four senators to side with Labor and the Greens to block the government's plan to force all super funds to give a third of their board seats to independent directors and appoint an independent chair.
As early as January, Industry Super Australia and AIST had already indicated they may shy away from full disclosure on any findings from the review.
Assistant Treasurer Kelly O'Dwyer, who in March pledged to push through the one third independent director rule, said the government had received no update from the Fraser Review.
Mandating all super funds to appoint a minimum of one-third independent directors and an independent chair was a recommendation of the government's 2014 financial system inquiry, led by former Commonwealth Bank boss David Murray.
The change has been lobbied for by the Financial Services Council (the lobby group for bank-owned and other retail super funds), which requires its members to have a minimum of 50 per cent independent directors and independent chairs.
Non-profit super boards are typically comprised of equal numbers of representatives from employer groups and unions representing workers in the fund.
Controversial change
Industry Super chief executive David Whiteley and AIST boss Tom Garcia had been vocal critics of the planned reform, which they have argued is unnecessary and politically motivated.
The Association of Super Funds of Australia (a peak body representing for-profit and non-profit funds) controversially said it would support the change.
Discontent among some non-profit fund members has been linked to the decision by longstanding ASFA chief executive Pauline Vamos to resign. In February, when she announced her plan to step down effective from June 30, Ms Vamos said guiding the passage of the government's controversial super fund governance bill through Parliament would be a priority during her last few months.
An ASFA spokeswoman confirmed Ms Vamos plans to stay in the role until after the election. Her successor is yet to be announced.
Mr Fraser, a former RBA governor and treasury secretary, was one of the first independent trustees of industry super funds and a longtime marketing spokesman for Industry Super.
His appointment was criticised by the Australian Institute of Company Directors for lacking independence. The directors' lobby also raised concerns in February that the review lacked transparency and proper process.
The Age
