Explosive allegations about misconduct by militant trade union the CFMEU and its historic and interpersonal links to Cbus are fuelling political opposition to the growing profit-to-member super sector.
At the Investment Magazine Insurance in Super Summit on Tuesday, outspoken critic and Coalition Senator Andrew Bragg described the alleged commercial links between Cbus and the CFMEU as “ugly”, and said that the “transfer of people’s retirement savings from these super vehicles into the union…is disgraceful”.
“I don’t see any case for the more than a million dollars in the last year which were given by the Cbus fund to CFMEU, including a $250,000 payment for sponsorship of the Victorian branch of the CFMEU, I don’t see how that passes our best financial interest duty,” Bragg said at the summit, hosted by Investment Magazine, the sister publication of Professional Planner.
The senator, who was promoted to the senior ranks of the Dutton opposition earlier this year as the new shadow assistant minister for home ownership, also called on Cbus chair Wayne Swan to resign his role, claiming he had an irreconcilable conflict of interest in maintaining the governance position at the construction industry fund while also serving as president of the federal Australian Labor Party. Swan was federal Treasurer in the Rudd-Gillard Labor government and also serves as the Cbus representative on the board of the Super Members Council.
The comments follow an investigation by Nine Entertainment Corporation newspapers and TV programs last week which detailed allegations of corruption and unlawful conduct within the CFMEU. Cbus Super and its wholly owned subsidiary Cbus Property have been fully caught in the crossfire after media reports alleged that CFMEU officials had bragged of their ability to secure business from Cbus.
Three CFMEU directors serve as employee-appointed board directors of Cbus – one of whom is CFMEU national secretary Dave Noonan, who is also on the Cbus Property board. The union and fund have a range of longstanding historic and interpersonal ties.
The investigation has led to the resignation of CFMEU head John Setka last week and the political fallout is still continuing. The Albanese government has announced that it will appoint external administrators to clean up the union.
The AFR also reported on Monday that the union’s NSW secretary Darren Greenfield allegedly boasted about being able to make Cbus select subcontractors favoured by the CFMEU. Cbus denied the allegation, saying that the selection process is handled by an independent contractor.
Bragg is also pushing for Cbus to be banned from funding the Housing Australia Future Fund (HAFF), of which Cbus was the earliest backer among super funds with a $500 million commitment in November 2022.
“I think they are an inappropriate party to be doing any government business with,” Bragg said.
“I think the Cbus fund should cut all ties with CFMEU. It shouldn’t be making any payments to that organisation and it should not be having its people on the board. And as I say, I think we need to look very carefully about how APRA is administering these law.”
A Cbus spokesperson declined to respond to Bragg’s comments. But in a message to members, CEO Kristian Fok defended the employer-employee equal representation model on the board, saying it has “contributed to the long-term success of our fund”.
“Cbus condemns any criminal activity in the building and construction industry. We support the efforts of governments, law enforcement and union organisations to eradicate any such criminal activity,” he said.
Cbus had around 12 per cent of its portfolio in property as of July last year.
The relationship between Cbus and the CFMEU, among other industry funds and trade unions, was examined and at times criticised by the Royal Commission into Trade Union Governance and Corruption, led by former High Court judge Dyson Heydon in 2014 and 2015.
A number of senior industry super movement figures were approached but declined to comment on the CFMEU-Cbus matter. However some privately questioned Senator Bragg’s motivation in raising the matter, given his well-documented hostility to the compulsory super system, and profit-for-member industry funds in particular.
