Among the many announcements in last month's Federal Budget, you could be forgiven for having missed one that could make a real difference for you. The government announced $1.6 million in funding over the next two years for CHOICE partner Super Consumers Australia, the people's advocate in the superannuation sector.
This is the first government funding for a small but effective team that's been working hard within CHOICE for the past two years. The idea was championed for many years by our former board chair Jenni Mack, and became reality two years ago after the Commonwealth Bank and ANZ were caught mis-selling super products through bank branches. They agreed to put some money towards consumer interests as one way to make amends.
Super Consumers Australia has had an amazing impact for a team of only five people
Since then, Super Consumers has had an amazing impact for a team of only five people. It has pressured superannuation funds to drop pandemic-related exclusions from insurance policies that could have seen many frontline workers denied cover. It also forced a number of funds to drop tricky tests for total and permanent disability cover that would have excluded many unemployed people or part-time workers.
Most importantly, Super Consumers has played an important role in many parliamentary debates about changes to the industry. This has included backing legislation that will stop super funds charging insurance premiums to inactive accounts, and force the consolidation of 10 million duplicate accounts, so people don't have their retirement savings eroded through fees and insurance premiums across multiple funds.
Having an organisation that can tell Parliament what's in the best interests of super fund members is particularly important when you consider the might of the other voices in debates about superannuation. Super funds spend more than $50 million a year of your super savings on lobbyists that represent their interests.
Having an organisation that can tell Parliament what's in the best interests of super fund members is particularly important when you consider the might of the other voices
Although these lobby groups say they're advocating for super fund members, the evidence shows that isn't always the case. Industry bodies have repeatedly opposed reforms that would ultimately mean more money for you when you retire – such as current proposals that would single out underperforming funds and force them to lift their game.
This doesn't mean that the entire industry is bad. There are some very good funds, but there are also some shockers, and it's far too hard for you to work out which kind you're in – and if you're unlucky enough to land in a bad one, it can cost you dearly.
The $1.6m in the budget is far less than we need to fix the super industry. But for now, it will allow CHOICE to help Super Consumers Australia to continue to take up the fight.