A Parliamentary Committee has been told that there were 19 instances in 2015-16 where over $1 million of superannuation was lost.
The Senate Economics Committee inquiry into the non-payment of the superannuation guarantee (SG) has been told by a Melbourne Law School academic that so-called ‘pheonix activity' often sits at the heart of non-payment of the SG.
Professor Helen Anderson said the non-payment of taxes and employee entitlements, including superannuation, was often the main objective of illegal phoenix activity.
"Estimates of the amounts lost are imprecise but are believed to be in the billions of dollars," her submission said.
Professor Anderson said that while about 8,000 companies entered liquidation each year, and their employees could claim the Fair Entitlements Guarantee (FEG), five times as many companies each year were abandoned and eventually deregistered by ASIC for failure to pay annual fees and submit returns.
"The employees of abandoned companies receive nothing from the company and do not qualify for FEG. Their access to FEG should be addressed. The amounts of lost superannuation of employees of abandoned companies are unknown and unknowable," the submission said.
Professor Anderson said miscreant employers and company directors should not be allowed to hide behind the shield of privacy.
"There should be better avenues for information sharing between unions, superannuation funds and relevant regulators," she said.
"‘Privacy' is a shield behind which wrongdoers act with impunity."
Her submission suggested that credit reporting agencies could act as market-based regulators and if they were given information about unremitted superannuation and those responsible for it, those persons were likely to find it hard to get finance for their next companies.