Andrew Bragg is in a hurry. And he is fast becoming known as the man who took on industry super and won, after enduring a barrage of intimidation. They hoped that their latest attempt to shut him up would remain confidential. It’s a real doozy.
In June the Morrison government passed reforms called Your Super Your Future that represent the biggest shake-up to super funds since the mandatory system was established in 1988. The aim is simple: to better protect the retirement savings of Australians.
Two months earlier, Bragg received a letter from law firm HWL Ebsworth acting for New Daily. They claimed the NSW senator had made false and defamatory statements against the publication. It concerned an opinion piece Bragg wrote in The Daily Telegraph on March 24 congratulating the ABC for cancelling its contract with “a propaganda outfit for the $3 trillion super behemoth”.
In that May 18 letter, New Daily’s lawyer claimed that the article gave rise to a series of “very serious imputations including that our client … improperly took members’ contributions from superannuation funds who are acting in breach of their legal and fiduciary obligations in order to operate a publication which merely spouted propaganda and had no integrity or editorial independence”.
The story goes back to last year’s October Senate estimates when Bragg exposed what he called a “wholly inappropriate alliance” between the ABC and the New Daily.
The NSW senator, who was elected to federal parliament at the May 2019 election, asked ABC chief executive David Anderson about Aunty’s contract with the New Daily. Anderson didn’t appear to know much about it. He took the question on notice.
Then, ABC’s director news, analysis and investigations, Gaven Morris, met with Bragg in the senator’s Sydney office in March this year. Bragg says Morris conceded the contract with New Daily needed to be cancelled. On March 22, the ABC cancelled the contract, and leaked the story to Nine Newspapers.
Bragg had notched up two important wins for the country. First, for taxpayers who fund the ABC. As Bragg said: “Why anyone at the ABC thought it was a good idea to get into business with superannuation lobbyists is beyond reason.”
It’s like getting into bed with big tobacco, or the mining industry. It’s not just absurd, it’s a misuse of taxpayer dollars.
Bragg also scored a win for workers by exposing that industry super funds “wasted $12m in workers’ retirement savings on the New Daily boondoggle”.
“The New Daily is a propaganda arm of Big Super, financed by workers’ Superannuation Guarantee contributions,” wrote Bragg in his March 22 press release. “This sort of largesse will be illegal if our proposed Your Future Your Super bill passes the Senate.”
The price of Bragg’s determination to protect workers’ retirement savings was a defamation threat from New Daily a few months later.
The prospect of being sued for defamation, of going bankrupt from having to spend hundreds of thousands of dollars dealing with, and defending a claim before it goes to court, would scare the pants off most people.
When asked about the defamation threat against him, Bragg told Inquirer this week: “My silence would be the wrong thing for my constituents: Australia’s workers who are forced to put their money in these funds.
“Big Super is obviously doing the wrong thing by propping up a newspaper to the tune of almost $30m. The New Daily is not in the best interests of workers. Super is for workers’ retirements, not propaganda.”
Companies are precluded from Australia’s uniform defamation laws. The exception is a non-profit organisation, or a company with fewer than 10 employees, provided that it’s not related to another corporation that is prevented from using defamation laws.
Bragg’s gun defamation lawyer, Rebecca Giles, wrote back to HWL Ebsworth on May 25 requesting details to support their contention that New Daily is an excluded corporation under Australia’s uniform defamation laws. A company search reveals that all 28,400,000 shares in New Daily Pty Ltd are owned by Industry Super Holdings Pty Ltd, a company with approximately 590 employees. The ISH website says that gets money from industry super funds.
Giles also noted that their claim to confidentiality was misplaced, given their letter amounts to a public concerns notice under the Act. She is still waiting for a response.
The industry funds have thrown everything at Bragg over many years. They came after him when he worked at the Business Council of Australia after he exposed what he called the “great dirty secret of financial services: over the past decade industry super has sent over $50m of worker’s retirement savings to support affiliated trade unions”.
Back then, Bragg was a lone voice calling for simple reforms such as having independent directors on industry super boards, just as they sit on the boards of big companies.
Fresh, independent eyes on industry boards could stop members money being spent on bloated boards that send board fees to unions, not to mention the millions of dollars in donations that industry funds send to unions each year.
The industry funds have never forgiven Bragg for his reforming instincts. When he moved into parliament a year later, the NSW senator and Treasurer Josh Frydenberg stepped up the pace and range of super reforms. In December 2017, Malcolm Turnbull pulled a bill to reform the governance of industry funds after Senate crossbenchers were pressured by union and fund operatives. Bragg and Frydenberg were determined their reforms would not meet the same fate.
The result is a set of critical reforms that protect the retirement savings of Australian workers. The first, and most important, reform is a legal requirement that funds prove they are spending fund money in the “best financial interests” of members.
Bragg told Inquirer, “this reform changes the game for them. Political donations, payments to unions, funding the New Daily, payments for vanity advertising to put Greg Combet’s face on the TV as chairman of Industry Super. It’s hard to see how these things can be proven to be in the best financial interests of their members”.
The second reform abolishes multiple super accounts. The fund a worker starts with will follow them even when they change jobs unless they choose to change funds. It ends another gravy train for super funds. They have relied on fees flowing from workers having multiple super accounts that accumulate with each new job. It’s often a stitch up; a default industry fund is mandated by agreement between an employer and a union.
The third reform targets underperforming funds with mandatory performance testing against benchmarks. As Bragg told Inquirer: “So many tax concessions go into the super scheme. We want to make sure that members of these funds are getting the best possible deal.”
Given the bullying by industry funds and unions last time round, how did these reforms get through?
“Josh did it,” says Bragg. “(The Treasurer) negotiated personally with the independents in the Senate. He decided he was going to get his hands dirty on this.”
Things got especially dirty over the first reform. The new “best financial interests” test raises questions about industry funds funding the New Daily. All eyes will be on new APRA head Margaret Cole to enforce these reforms.
Bragg is determined to make use of his time in parliament. His book Bad Egg: How to Fix Super published last year helped maintain his poll position as enemy No.1 of industry super funds.
Bragg is no cookie cutter Liberal. He is also making the case for an Indigenous Voice to the federal parliament. On the first page of his new book published in May this year, Buraadja – The Liberal Case for National Reconciliation, Bragg thanks several people for helping him. He writes: “Time is precious. You paid it forward. I will too.”
A man in a hurry to fix things is a big threat to those who want the status quo maintained.
Janet Albrechtsen is an opinion columnist with The Australian.