Media Super was formed in July 2008 from the merger of Print Super - the industry fund for workers in the printing, packaging and graphic arts industries, and JUST Super - the industry fund representing workers in the media, entertainment and arts sector.
Media Super traces its ancestry back to early 1987, near the very beginning of Australia's modern day superannuation system.
In the beginning...
Before the mid-1980s only 39% of the workforce had access to superannuation, with eligibility limited by a worker’s age, gender, occupation and work status. While some high income white collar employees, public servants and members of the Defence Force could access old-style defined benefit funds, women and blue-collar workers were poorly represented and significantly disadvantaged.
In response to campaigning on industrial matters by unions and ACTU, the National Wage Case in 1986 led to an accord with the then Labor Government to introduce a mandatory 3% superannuation requirement into workplace awards.
Many of the first Industry superannuation funds were established in response to the ruling, their governing structures overseen by the relevant workers’ unions and representative industry multi-employer groups.
Print Super and JUST Super were among these early industry funds, both tracing their inception back to 1987.
Superannuation Guarantee (SG)
With shortfalls in the existing system including a lack of coverage for workers not covered by industrial awards and the recognition of changing population demographics, the Federal government introduced the Superannuation Guarantee in July 1992.
The Superannuation Guarantee made super compulsory for all employees earning more than $450 a month, with the minimum SG rate rising from 3% to 9% over the following ten years.
Superannuation was designed as an investment vehicle rather than a savings account. With the increase in contribution rates, Industry funds recognised the need to diversify their existing portfolios in shares and fixed interest and pioneered moves into non-traditional ‘alternative’ investment classes like infrastructure and unlisted businesses.
Investment arrangements in a typical Industry fund usually consisted of a single ‘balanced’ investment portfolio comprised of a mix of potentially risky but high return ‘growth’ investments balanced against safer low return ‘defensive’ investments to ensure the best long term returns for members.
Member Investment Choice, introduced in 1998, allowed fund members to choose from a new array of portfolio blends or single asset options geared to their own preferred risk tolerance.
In an era where household savings are low and household debt is high, the government has actively encouraged Australians to add to their retirement accounts by providing tax incentives and co-contribution arrangements.
A co-contribution scheme for low to middle-income earners was first introduced in 2003. Under this arrangement, the government makes an additional contribution to your super account if you make up to a set level of voluntary after tax payments to your super in a financial year. Limits on income levels, amount of voluntary contributions and co-contribution rate have varied year-to-year but still apply.
Choice of Fund
As super began as an industrial matter linked to workplace awards, membership of most early Industry funds was restricted to workers within that industry - changing jobs could mean changing superannuation funds.
To address the growing number of lost or neglected accounts across all sectors, the government introduced Choice of Fund legislation in July 2005. Many Industry funds, including Print Super and JUST Super, became ‘public offer’ around this time - anyone could join. This measure allowed workers to choose the fund their super was to be paid into, regardless of the industry they were employed in.
Better deals for retirees
Also included in the 2005 regulations was the Transition to Retirement provision – the ability for those over their preservation age but still working to access some of their super as an annuity or pension without having to leave the workforce, thereby reducing the financial pressure on those who felt they would otherwise have been forced to retire.
Prior to 2006, cashing of super as an allocated pension or lump sum was compulsory once members reached certain age and work limits. New rules effective 10 May 2006 allowed retirees to leave their benefits in super indefinitely, enabling their super to continue to grow in a tax effective environment.
Adjustments to taxation rules for super were implemented in July 2007, the most significant of which was the removal of tax on super withdrawals for members over 60.
As the Australian workforce gets paid in a multitude of ways with innumerable variations in access to shift loadings, paid overtime, hourly rates, allowances, leave entitlements, salary packages, bonus or commission schemes and the like, SG could also be calculated in a number of different ways. From July 2008, minimum SG has been calculated on Ordinary Time Earnings (OTE).
Standardising the earnings base meant workers would be guaranteed to receive the same minimum super contribution if they had the same OTE.
As super is invested in investment markets, members used to strong growth in the previous years suffered some shock when the GFC hit in 2008-09. Portfolios geared toward harvesting large gains suffered the most while others in barely valuable cash investments seemed the most insulated from the fallout.
Many of the measures implemented since the GFC have been aimed at addressing some of the volatility in investment returns and improving short-term outcomes for those closest to retirement.