During a Senate estimates hearing, Liberal senator Andrew Bragg asked the prudential watchdog about expenditure disclosure and advertising in the superannuation sector, with a focus on an Industry Super Australia TV campaign, titled Our Biggest Project.
The senator referred to Nielsen data, which stated the campaign would be set to cost $40 million.
“Now this is not a campaign which is proposing to promote a product or a fund that a member can invest in, it’s just a political brand effectively,” Mr Bragg said.
“This is good evidence of the fairly lax standards, where people feel they can spend $40 million promoting an umbrella brand.”
But APRA deputy chair Helen Rowell had commented that the regulator’s checks around spending are set to rise moving forward, with it expecting to cause stronger disclosure and cutbacks on funds’ spending.
“I am not aware of the specific details of the total costs of that program Senator,” she said, referring to the Industry Super campaign.
“We have actually started some work at the moment to look into some of the material sponsorship and advertising arrangements that we are aware of across the industry, with a view to require some of those trustees involved in those arrangements to provide us information to help us understand how they have assessed the value and benefit of that expenditure.
“The sort of campaign you’re referring to is the sort of arrangement we do think requires heightened scrutiny and we are working to do that.”
Mr Bragg also asked if the recent changes declared in the federal budget, which are set to require funds to disclose expenditure, will make it easier for the regulator to prosecute breaches.
“We do view the government’s proposals as helpful, and we do think they will sharpen and strengthen our ability to take action,” Ms Rowell said.
“We have looked at the categories of information on expenditure that we want to get going forward and political payments or donations is one of those categories.”
APRA also introduced a new prudential standard at the start of the year, which reportedly has stronger expectations around managing expenditure and requires more granular disclosure than before.
Ms Rowell expects the regulator will have more visibility around funds’ spending and their governance and thinking as a result.
Mr Bragg has previously scrutinised political donations from super funds, having written to APRA about Sunsuper’s payment to the Labor Party when it attended a breakfast event.
The senator has asked how political donations can meet the sole purpose test, which requires super funds to be maintained for the sole purpose of providing retirement benefits to members.
Sarah Simpkins
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
You can contact her on [email protected].
