We have won the battle, not the war: AustralianSuper CEO

AustralianSuper chief executive Ian Silk told the Royal Commission the industry super Fox in the Henhouse campaign helped win the battle, but the war continues over default superannuation arrangements.

The chief executive of Australia's largest super fund was called to the witness box for the afternoon session on the fourth day of the Royal Commission's investigation into superannuation.

Silk, who sits on the board of Industry Super Australia (ISA) - the lobby group behind the campaign, said the Fox in the Henhouse advertisement was intended to sway the opinion of federal politicians considering legislative changes which would affect how employers assign a default fund to employees.

"Most employers in our experience want to do the right thing by employees. But, we know with certainty that some institutions have sought to negotiate with employers and leverage business banking relationships into a change of default fund applying at the workplace," Silk said.

Responding to questions from counsel assisting Michael Hodge, Silk said if the Fox in the Henhouse campaign were judged on its ability to stem the flow of crossbench senators supporting legislative reform to the default system, than it must be considered a success.

"If that's the objective, it's a pretty binary view. To date, it's been successful," Silk said.

"It's a battle that's been won, not the war."

Silk added the ultimate purpose of ISA's campaign was to ensure legislation wasn't passed which would diminish the financial outcomes of superannuation members, particularly AustralianSuper members. He said the rationale was members who left the industry fund would likely face poorer retirement outcomes if they moved to a retail fund.

Additionally, Silk confirmed greater inflows of new members into AustralianSuper ensured the strength of the fund as a whole.

"It was the fund's view, the board's view and my own view as well, that if the policy changed, some current members of the fund were likely to leave the fund and go to a fund that we would say would provide a poorer experience and ultimately a poorer financial outcome for members. So those members would be worse off," he said.

"The remaining members of the fund would have diminished economies of scale available to the fund to deploy on their behalf."

Earlier today the commission heard NULIS struggled to manage conflicts of interest between itself and NAB Wealth, in dealing with the plan service fee issue.

Counsel assisting Michael Hodge suggested to former NULIS chair Nicole Smith the trustee "simply couldn't manage the conflicts" between itself and other related parties in the plan service fee issue which has now plagued NAB during the first week of superannuation hearings.

Read more: AustralianSupersuperannuationRoyal CommissionIan SilkISAMichael HodgeNABNULISIndustry Super AustraliaNicole Smith
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