Will they let the foxes in?
Big banks continue to lobby for changes to the Australian super system, which may not be beneficial to super members. See how banks differ to industry funds like Cbus.
The big banks continue to actively lobby our Federal politicians to make changes to Australia’s superannuation system, by disrupting the industry fund model and allowing them to get a greater share of people’s super savings. It’s akin to letting the foxes into the henhouse.
Cbus, as an industry superannuation fund, believes that in the long term, this could have a detrimental impact on people’s retirement outcomes.
Source: Industry SuperFunds Australia (ISA)
There are fundamental differences between bank owned retail super funds and industry funds such as Cbus which could affect you:
Banks operate on a model of making profit for shareholders
Industry funds operate on an all-profits-to-members model. We do not pay dividends to shareholders.
Industry funds consistently outperform the bank owned retail funds
Over the past 20 years, industry funds have, on average returned 6.3% per annum compared to the bank owned funds returning 4.5%.1
Industry fund Boards have equal employer and employee association representatives
The industry fund governance model means our Boards are made up of equal representatives of employer and employee associations. In Cbus’ case they are drawn from the construction and building industry. They possess or bring in the skills necessary to oversee your funds, they act solely in members’ best interests and they understand the industry that most of our members work in.
This means important decisions about investments, products and services are designed with our members’ needs in mind. In the case of Cbus, it means investing back into the construction and building industry, providing strong returns, creating work for tens of thousands of our members, and supporting our economy.
Industry funds are the default nominated funds in most Awards and agreements
This means people starting jobs who haven’t or do not have enough knowledge to make a choice about which fund they are in, are placed in an all-profit-to-member fund that looks after their interests.
No commissions or sales incentives for advice from Industry funds
Cbus and other industry funds don’t pay commissions or provide sales incentives to financial advisers to market our funds. It would be easy to lose count of the scandals that have engulfed the big banks around poor financial advice and the selling of products that are not in their customer’s best interest, including superannuation.
The big banks want this all to change.
The big banks want our Federal politicians to:
- Disrupt the model of not-for-profit super funds that are run only to benefit members and don’t generate profits for shareholders; and
- Remove protections in the system which provide quality approved funds as the workplace default funds.
Cbus, along with other industry funds, think Australians deserve to know what is going on. After all, your super is your money and the superannuation system should be working for you – not bank shareholders.
Because most Australians agree that super funds should be run on a not-for-profit basis, industry super funds launched a new campaign Banks Aren’t Super. Find out more about what’s going on with our superannuation system and what the big banks are up to.
Remember - Keep your super in good hands.
1Source: ISA analysis of APRA Annual Superannuation Bulletin, June 2016 and APRA 2007-Insight-issue-2 celebrating 10yrs of Superannuation Data Collection 1996-2006.
*Note SuperRatings estimate that industry funds outperformed retail funds (including bank-owned) by 2.7 per cent on average in 2016; by 2.2 per cent over 10 years. Past performance is not a reliable indicator of future performance.