SYDNEY, (Reuters) - Australia’s largest pension fund on Thursday defended using members’ money to bankroll a marketing campaign that depicted the country’s biggest banks as foxes aiming to take a larger share of the country’s A$2.6 trillion savings pool.
AustralianSuper Chief Executive Ian Silk, the most senior financial sector executive to appear at the year-long Royal Commission inquiry, said the A$500,000 ($371,050) spent on a TV ad depicting a fox being let into a hen house by a man dressed in a suit, met a requirement to act in the best interests of members.
“The ultimate purpose was to ensure that legislation was not passed,” Silk told the inquiry. “That would diminish the financial outcomes of... AustralianSuper members.”
Australia is the 14th biggest economy but has the third-largest pension pool in the world, showed data from the Organisation for Economic Co-operation and Development.
Managers of some of the largest retirement funds are having their performance scrutinised at the inquiry into financial sector conduct, which has already roiled the banking and funds management industry.
Laws require employers to pay nearly a tenth of wages into a fund that employees cannot access until they retire. But low financial literacy among Australia’s 12 million workers means the choice between a union-backed fund or a higher fee-charging private fund is often made by their employer.