Liberal senator Andrew Bragg has continued to push the prudential regulator on its apparent light-touch treatment of Industry Super Australia’s investment in the New Daily, with the controversial publication now in hot water over its treatment of super fund member data.
In a Senate estimates hearing on Wednesday, senator Andrew Bragg said the industry fund advocacy group’s decision to establish the New Daily was “not a normal investment” and that the opaque nature of funds’ investment in the media outlet should be a matter of concern for APRA.
“There’s a compulsory SG system and that money has been used to set up this organisation through various structures – the question is what treatment does APRA apply to that money, is it going to sit as an expense or an investment?” Mr Bragg said.
“Given the scale of money that’s gone into this program, I think it’s important for APRA to provide some guidance.”
Industry Super’s investment in the controversial publication – which recently ended a $60,000 commercial arrangement with the ABC following Mr Bragg’s protestations around wasting member money – would fall under a broader review the prudential regulator was conducting into super fund advertising arrangements, APRA executive director of super Suzanne Smith said.
“At the moment none of the funds invest directly in the New Daily – they’re removed from any direct ownership, so they are shareholders in ISH (Industry Super Holdings) which is the owner of the New Daily,” Ms Smith said.
“That’s a historical position where super funds chose to invest in the New Daily. Some treated it as marketing expenditure, some treated it as an investment. We’d be looking at what the decision making process was around any investment that was made – funds are required to have an investment strategy and the decision on whether that investment was appropriate is what we will look at.
“It’s about the review process of whether the investment has returned what you would expect it to do. What we’re looking at is the decision making around how that fits into a portfolio and what that return is.”
Following revelations last month that AustralianSuper had supplied its members’ data to the New Daily to subscribe them on an opt-out basis, Ms Smith said the prudential regulator was also conducting inquiries as to whether the move had been against privacy rules.
“We made inquiries in relation to the New Daily last week when we were made aware of those issues – we sought information in relation to the trustee’s decision making and we’ve sought information from other entities around what their practices and processes are in relation to member information,” she said.
“Our inquiries are ongoing and we’re liaising with the privacy commissioner in relation to that matter. I haven’t got an exact time frame, but we would expect these discussions will be happening in the next few days and weeks.”
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