Wayne Swan grilled in inquiry over super scandal

Former treasurer Wayne Swan, who now chairs Cbus Super, faced a hostile Liberal inquiry over the mishandling of insurance payments and payments to the embattled CFMEU. Led by anti-superannuation senator Andrew Bragg, the senate economics reference committee took aim at Cbus’s insurance payouts. Appearing via video link, Mr Swan took the opportunity to apologise to members for delayed payments, saying he was “sick in the guts” due to the slow process impacting family members. “First of all, I want to apologise to all of those who’ve been affected in our fund and that we as a board, when we first became aware of the magnitude of this problem set out to rectify this problem, and something like 80 per cent of young adult cases have now been dealt with.” Mr Swan said the superannuation fund was working closely in all areas of risk management to try to overcome issues, including those of insurance risk. ”We have frameworks in place and we’re working with regulators to make sure they’re the best frameworks,” he said This was the second apology Mr Swan has made in two days following an address during the Cbus annual general meeting on Thursday night. “Last year, the fund reported to this meeting on delays to our insurance claims handling and the steps taken to remediate and compensate affected members,” Mr Swan told the AGM. “Once again, I want to apologise unreservedly to the members and families impacted by these delays … and to members of the fund as a whole.” Mr Swan’s apology comes after the super giant has been drawn into a deepening crisis after the Australian Securities Investments Commission launched legal action against the fund earlier in November, alleging delayed payments of $20m worth of death and disability benefits. ASIC alleged that Cbus did not take appropriate action when it was warned about the massive failures, with more than 10,000 claims not being paid out. ASIC alleges that despite receiving reports from its third-party administrator, Australian Administration Services Pty Ltd, United Super failed to properly assess the scale of the impact to members and claimants. The financial loss has been estimated by Cbus to be $20m to members and claimants. “Delays in claims processing like those alleged by ASIC cause real harm to families who may be relying on the payments to meet critical expenses,” ASIC deputy chair Sarah Court said. ”By late 2022, more than 6000 Cbus members and claimants had their payments delayed by more than 12 months. Extraordinarily, that equates to more than 50 per cent of Cbus’s total claims at that time. We allege they are yet to completely rectify these issues.” Cbus has deflected some of the blame on Link Administration Group, which handles its insurance claims. The former treasurer also deflected questions from Senator Bragg about the fund’s commercial arrangement with the CFMEU. ”You gave them $2.7m last year,” Senator Bragg said. Mr Swan denied the allegation several times. “We’re not handing them money and it’s not right of you to characterise commercial partnership arrangements as hand-outs,” he said.