Michael Crouch AC

A titan of Australian business, Michael Crouch AC died earlier this year. 

We all have so much to gain from embracing Crouch’s legacy. 

Crouch quietly, generously supported many great and important causes while running a pioneering Australian manufacturing company, Zip Industries. 

Today we take instant access to hot water for coffee, tea and soup in offices and homes for granted. 

Yet before Michael Crouch acquired a small Sydney heating company Zip in 1962, waiting for kettles to boil before having a cuppa was the standard. 

Crouch led an innovative company which pioneered the boiling water tap through advanced manufacturing.

He told the Australianin 2010 his company would reach for the sky: "By the mid-80s we were in a lot of places in Sydney. We said if we can do that in Sydney we can do it in a lot of places around Australia, and if we can do it in other cities around Australia we can do it around the world – maybe.”

The result – a presence in 77 nations. 

Obituaries have recorded his enormous contribution to the Duke of Edinburgh Award, the Michael Crouch Innovation Centre at UNSW, Royal Flying Doctors Service and the Menzies Research Centre.

Over many cups of coffee courtesy of his boiling water innovation, I learned first hand two great lessons from Crouch. 

One paved the way for his commercial success and the second was his contribution to his nation.

“You have to improve your communication Andrew”. This was one of Michael’s favourites. It was true. There was no point having the best ideas if you couldn’t communicate them clearly. 

He understood better than most people that complicated messages, especially about public policy, would not work. 

He bemoaned how business leaders often had complicated messages or we not prepared to get out and make a simple public case which advanced a policy agenda. 

We often discussed how lethal the anti business forces such as militant unions had become with their underhanded untruths about tax, regulation, trade and investment. 

His view was they were the consummate communicators and even if everything they said were lies, they were winning because they had mastered simple public communication.

I once received a note from him which said: “What you sent me, and the work that will flow from it will, I believe, be of great interest to university dons and, hopefully, some bureaucrats.”

And: “I’m no good on long documents – there’s far too many of them streaming in every day.  I like short, punchy statements illustrated by fact, easily readable and very penetrating.”  

He knew there was no point talking to the insiders without having a simple message for the masses.

Michael invested heavily in communication to get his innovative hot water taps accepted by building designers, office managers and households. No easy feat.

In an era where the policy settings that delivered decades of growth are more contested than ever, we ought to take on Crouch’s challenge to get our facts from university “dons” but unleash simple, direct communication to the people.

Of course this formula will only work if business leaders are prepared to enter the public arena as they should. 

The second big lesson from Crouch was: make time to improve the world around you. 

He had a vast array of projects which supported people and causes: the innovation centre at UNSW which takes his name, the Duke of Edinburgh awards which he ran from his private office, Symphony Australia, where he was chairman and the Menzies Research Centre to name a few.

He was genuinely interested in the affairs and standing of the nation. 

His contributions to Menzies and innovation at UNSW were serious efforts to advance the cause of liberalism and enterprise: bedrocks of his and Australia’s success. 

It was emblematic of a leader who took nothing for granted. He knew the values of liberalism and enterprise were contested and needed to be nurtured. 

He committed time, money and prodigious energy to these causes. He did not do so after he left full time executive life. In the mid 1970s he was Honorary Treasurer of the NSW Division of the Liberal Party. 

Few executives are prepared to donate their own money or that of their companies to support democracy these days – whether it be Liberal or Labor. Even fewer would be prepared to take on a demanding role within a political organisation mid-career. 

The net result of less civic engagement from business leaders is simply poorer public policy and a poorer nation. The void will always be filled by people that do not understand how an economy works and what creates jobs and national prosperity. 

That is why Crouch’s time and effort on his causes was so valuable. He knew how to do it. He walked the walk.

Long may we remember Michael Crouch, he was a great Australian.

Statement on Industry Super Australia claims – 11 June 2018

Industry Super Australia (ISA) released a four page statement on 5 June 2018 on my recent articles and presentations. ISA’s four page statement is not only a waste of workers’ superannuation but reinforces points I have been making that industry super funds are:

1.    Delivering extensive funding to the union movement (at least $60m in the past 10 years according to the Australian Electoral Commission & growing to $22m per annum within a decade); 

2.    Developing into a US-style “Super PAC” which aggregates large sums of money for aggressive campaigns – in this case by using retirement savings;

3.    Union controlled and have union links which can damage investor (member) interests; and

4.    Resisting reforms to improve the transparency and governance standards of the whole superannuation industry purely for self-interest.

This is my longstanding belief. In December 2014 I wrote in the Australian newspaper that:

“The interrelated issues of low standards of corporate governance in the superannuation industry and conflicted and anti-competitive relationships between industry funds’ boards and the default superannuation laws must be addressed by the Parliament.”[1]

I do not need four pages to respond to the statement paid for by superannuation members. The substantive points are:

1.    No explanation of why at least $60m has been paid by super funds to unions over the past decade has ever been provided. 

The $60m paid to unions over 10 years is not disputed by ISA, nor is the estimated growth in payments to unions of $22m per annum within a decade;

2.    ISA has failed to explain why super funds do not publish a breakdown of payments on super fund websites. The most relevant admission is: 

Payments by industry super funds to unions and employer groups are primarily for services, including for director remuneration, marketing and sponsorship.”

If so, why not disclose this on fund websites or annual reports? What do you say to members who are not members of a union when you are sponsoring union conferences? Union payments, corporate spin doctors, advertising campaigns, sponsorships, big fees to union directors are all paid for by monies saved by workers - many of whom don’t have enough saved for retirement.

The ISA statement tries to defend CBUS’ significant payments of $13m to the CFMEU by arguing that payments are for “branding, member education and advertising opportunities and for director fees”. Again, why not disclose this on the website? Most companies don’t make big payments to unions. Given 85% of Australians are not union members, this would be of interest – especially to unwitting members of the public that have joined CBUS. Would a small business owner really want to be funding the militant, law breaking CFMEU with their retirement savings?;

3.    “Super PAC” behaviour is now on show. Few sectors of the economy have such significant resources to waste time generating four page statements to which scant attention is paid. 

Money is no object. According to Michael Roddan in the Australian, the budgets of three of the four superannuation bodies are devote almost $50m per annum to promote industry super:

“ISA last year ran a budget of $22m paid for by its 16 member funds. The FSC has a budget to the tune of about $9m a year. AIST charges its member funds just under $10m for representation, while ASFA has annual revenue of about $13m.”[2]

Disclosure – I formerly worked for the FSC;

4.    Payments from industry funds to unions are likely to be higher than $60m. 

This baseline number is only known because associated entities (unions) are captured under electoral law and must disclose payments received– including those received from super funds. As some unions are not associated with political parties, their receipts are not captured by the AEC and we do not know how much money has been paid by these super funds to unions. They remain secret payments; 

5.    Unions control 50% of many industry funds – through 50% board membership or by owning half of the shares in the super trust or company.

The current union agenda of advocating an uncompetitive tax system (opposed to company and personal tax reform) and anti-trade (opposes China-Australia FTA and TPP) is inconsistent with member (investor) interests. This is magnified because 85% of Australians are not union members but the super funds are open to the whole public; 

6.    Law reform should deliver: 

a.    Independent directors onto all superannuation boards – be it bank, insurer or union. This will surely end the opacity and ultimately the payments. The Senate should act in the national interest and pass the Bill on the table;

b.    An end to the Orwellian Fair Work Commission dishing out $10 billion a year in “default” super contributions to industry super funds and foster competitive tensions as the Productivity Commission has recommended. This will drive better behaviour and hopefully lower fees for all Australians; and

c.     All Australians should be free to select their own super fund. Workers should not be trapped into enterprise agreements which remove their right to choose a fund.



Remarks at Friedman Conference 2018

Super funds underwrite super unions

Industry super funds have made Australia’s trade unions our own only mega rich US-style PAC or political action committee.  

Unions sit on assets of more than $1.5 billion, thanks in part to industry super funds which have gifted $60 millions to unions in the past decade. 

Union controlled industry funds are another example of the financial services sector having more than its fair share of rattlesnakes in the cupboard. 

The last few months have revealed, however, how many of us (myself included) got it wrong on a Royal Commission. The testimony on financial advice has been truly shocking. 

Soon the Royal Commission will begin examining the superannuation sector. 

I make three points in the lead up to these hearings. 

1.    Secret industry fund payments to unions are as shady as banks and insurers charging dead people for financial advice;

2.    Australian Electoral Commission (AEC) figures show payments from industry funds to unions will balloon to $22 million each year within a decade; and 

3.    How the Royal Commission (and the Senate) can fix it.


First, failing to disclose the $60 million in industry fund payments to unions and what these payments are for in annual reports or on websites is as opaque as it gets. 

This information is actively concealed from unwitting savers.

Superannuation is compulsory and most Australians do not select a fund of choice. Industry super funds have a monopoly on “default fund” selection through the Fair Work Commission where they receive $10 billion a year - guaranteed. 

With union membership at less than 15% of the workforce, most Australians have actively chosen not to support unions yet almost all of us are supporting kickbacks to union campaigns through payments from industry super. 

If people knew they were supporting the CFMEU, they would likely take their super elsewhere.

CFMEU boss John Setka said last week: 

“We get fantastic pay rises and good conditions for our members because we fight it outside the law. And if that sometimes brings us on the wrong side of a bad law - and there [are] bad laws - then so be it."

It is the hard-working non-unionised, law abiding workers who are automatically signed up to funds like CBUS that are paying the CFMEU’s $15m legal bill for breaking our laws.


Second, the latest AEC figures including 2016/17 show another $6 million was paid in this year from industry super funds to unions. This new data brings the total amount paid to almost $60 million over the 11 years reporting to the AEC has been required under law. 

At the current growth rate, payments are on track to hit $22 million per annum within the next decade. If you are a member of an industry superannuation fund, every cent of these payments is taken directly from your retirement savings. 

By far the largest beneficiary of union fund largess is the law-breaking CFMEU, which has benefited to the tune of over $13 million. 

Industry funds Host Plus, LUCRF and TWU Super have been particularly generous, each paying various unions between $7-8 million each, and even Australian Super, has paid unions almost $5 million.

Perhaps of greatest concern are the opaque payments coming out of the elusively named Industry Super Holdings (ISH), which is a wholly owned industry fund conglomerate. 

ISH companies paid unions an additional $5 million since 2006, including a range of large ‘once off’ payments, such as $1.1 million to the AMWU in 2015-16, and another $900 000 to the same union the year before. 

What is this money for? Union appointed directors have never been asked to justify the payments and demonstrate they are not consumer rip offs.

The ACTU has set the standard against which industry fund directors and CEOs will be judged in the upcoming superannuation hearings. 

The ACTU gleefully welcomed the resignation of AMP’s CEO as a suitable punishment for ‘swindling thousands of Australians out of their hard-earned money.’ 

This is a standard which should be applied broadly. But we shouldn’t hold our breath. 

The world class hypocrites in the union movement demand companies they invest in have a majority of independent directors. Yet they decline to adopt the same standard. 

Equally, despite being obsessed with tax, unions invest in tax havens such as Guernsey.  


Third, the Royal Commission must make it clear the Senate must urgently pass laws to improve superannuation governance and transparency. 

At a minimum, payments from super funds to political organisations should be fully disclosed in annual reports and available online.  

People should be able to see how much of their retirement savings has been given away by their industry superannuation fund to trade unions.

To get the facts into the public domain I have established a new searchable portal to present the data on the siphoning of retirement savings to unions: www.andrewbragg.com/supercheck.  

The new tool allows you identify just how much of people’s retirement savings each super fund has paid to each trade union over the past 11 years based on AEC data. 

The only reason these figures have come to light is through manual fusing of spreadsheets from the AEC.  

Until a higher standard of transparency is required under law this database will deliver transparency to working Australians.