Illustration: Glen Le Lievre

Illustration: Glen Le Lievre

As of next month, I will have worked at Fairfax Media for almost seven years, with a fair chunk of those in the business pages or writing on national economics. A search of our online company archive system shows that, in that time, I've written 115 articles that include the word "superannuation".

I conducted that search this week when I realised that while writing those articles, I've checked my own super balances precisely once, an exercise I recently undertook. It showed I had six different accounts, that at least one old boss probably wasn't making the contributions they were meant to, and that I might be able live very cheaply for less than a year on the "wealth" so far built up in my name.

The fact that someone with a professional obligation to be interested in super can't bring himself to be interested in his own super seems a good advertisement for one of the better initiatives of the Rudd/Gillard/Rudd years.

That is the introduction of MySuper, under which people who do not check their balances or pay much attention to their funds stand a lesser chance of being skimmed by companies managing money on their behalf.

MySuper, a big reform, started proper this year. But super is such a peculiar feature of the Australian economy, with such a spectre looming over it, that there are always calls to reform it, to do yet more with it, to eke better personal and economic returns from the money we all tip into it.

There is more than $1.7 trillion tied up in Australian super savings. This is a stupendous amount, and more than the yearly economic output of the nation. With the country facing so many obvious needs, this deep sea of funds is an intuitively attractive salve for many of them.

Australia needs new roads and rail lines, ports and hospitals; governments say they do not have enough money to pay for them. Why not use all that super to make it happen? Why not use that super to make a lot of things happen?

A recent paper by one of the many vested interests in super - the union-backed industry super funds - makes the case that superannuation has done a poor job of channelling the savings that we put into it back into the economy in the form of productive investment.

The paper, prepared by Industry Super Australia, argues that for every dollar paid into the financial sector, a large and growing proportion of which is through super accounts, the finance sector itself is retaining an ever-increasing share. It is retaining that share, the paper argues, instead of passing those savings back into the economy through investment in other forms of capital.

The study says every dollar of resources that was tipped into the finance sector in 1990 led to $3.50 in capital formation. By 2012, every dollar invested in finance led to $1.50 of capital formation.

The finance sector, and particularly all the auxiliary industries that have sprung off traditional banking, have got better at retaining that money for themselves and the people who work there. Between 1990 and 2012, financial profits rose 10.3 per cent a year and salaries rose 7.7 per cent a year. But the number of people who worked in the industry increased just 0.6 per cent a year, meaning that if you kept your job in finance, you've done very well.

Little wonder then that the average wage in auxiliary financial services - activities such as securities and debt broking, investment management and banking - is up to about $250,000 a year.

From ISA's perspective, the message from their analysis is that for the sake of the national economy, superannuation funds could be more profitably spread around. A larger share of that $1.7 trillion could be invested in roads and rail, ports and airports, housing, hospitals and industry, rather than staying within the profitable enclave of finance.

But there's another way of looking at the issue, even accepting ISA's argument that the financial sector is not doing a great job of spreading funds around and does too good a job of retaining wealth for itself - Australian finance is probably big enough already, or at least does not need any more government help to grow further.

When Prime Minister Tony Abbott and Treasurer Joe Hockey said they would delay the planned increase in compulsory super contributions from 9.25 per cent to 12 per cent by two years, Labor dubbed it a betrayal of working people. But why do we need to have 12 per cent of our salaries salted away to be managed by people who may or may not do a good job, within an industry that pays itself twice what the rest of the country earns?

The Labor-commissioned Henry tax review expressly recommended against an increase in the super guarantee of 9 per cent, saying low and middle-income earners should not be forced to forgo any larger share of their salaries.

Instead, it said governments should help prevent people losing their savings by paying unnecessary fees and commissions, the type of thing that has now happened with MySuper.

Another argument in favour of increased mandatory super contributions is that they help to build the funds that can then be invested in social and economic infrastructure - in those trains and roads and hospitals.

But why do those investments need to be funnelled through an industry which, like all industries, is driven by an impulse to retain as much as it can for itself, and which has shown a particular rapacity in doing so?

If people want governments to spend more money on infrastructure, then that's what governments should do: trying to get super funds to solve the problems of the nation seems too clever by half, and implies a role for the funds that they were never designed to fulfil.

If I ever did pay attention to my super, I'd probably be keen it didn't lose money on a risky toll road.

Ross Gittins is on leave.