Retirement
1 in 3 Aussies considers a super fund merger positive
Following APRA’s admission that smaller super funds need to merge with larger firms to guarantee better member outcomes, new research has revealed that almost one in three Aussies considers a merger to be positive.
1 in 3 Aussies considers a super fund merger positive
Following APRA’s admission that smaller super funds need to merge with larger firms to guarantee better member outcomes, new research has revealed that almost one in three Aussies considers a merger to be positive.
Amid the recent wave of mergers and consolidation within the superannuation industry, Investment Trends has revealed that 27 per cent of members see merging with a larger fund as a positive outcome, compared with 11 per cent who see it as a negative.
This positive sentiment holds even if their super fund opted to merge with a smaller fund (21 per cent positive versus 11 per cent negative).
“There is a general view that engagement between Australians and their super fund is underwhelming, but our research shows that super fund members are very much engaged with current events, having strong opinions about their super fund’s strategic decisions,” said Bailey Hao, senior analyst at Investment Trends.
According to the research, for the 11 per cent of members who hold a negative sentiment about mergers, most are concerned about potential negative impacts on fees and returns.
Many are also worried about changes to customer service levels and how they interact with their super fund.
“Super funds that are in the process of merging, or thinking about doing so, will do well if they alleviate their members’ top concerns of potential increased fees and underperformance. But our research also highlights that branding plays a key role,” said Mr Hao.
While most members (78 per cent) are indifferent if their super fund were to change its name or logo post-merger, a large cohort (18 per cent) oppose these potential changes.
Last month, APRA deputy chair Helen Rowell said Australia currently has too many superannuation funds, with smaller funds needing to merge with larger firms.
Funds with less than $30 billion under management, Ms Rowell noted, cannot remain competitive, often charging members more for underperformance.
“The emerging industry view seems to be that any fund with less than around $30 billion in assets under management is increasingly going to be uncompetitive against the so-called ‘mega-funds’,” she said.
“While there will inevitably be debate about the threshold level of assets needed, we agree with the sentiment. Smaller, underperforming funds would ideally consider merging with a larger, better-performing partner rather than another small fund – especially one that is also underperforming.”
According to APRA data, almost 90 per cent, or 124, of the 142 funds in APRA’s fund-level superannuation data have less than $30 billion in assets.
RELATED ARTICLES
About the author
About the author
Superannuation
Election policies could reshape Australia's superannuation landscape, expert warns
Competing superannuation policies from Australia's major political parties could have significant implications for investors and retirees, according to a financial expert. Read more
Superannuation
Industry leaders weigh in on concessional super tax as Budget confirms $55bn investment
Changes to the taxation of superannuation earnings and contributions have drawn mixed responses from financial and payroll sector leaders, as the Federal Budget confirms over $55 billion in ...Read more
Superannuation
Call for indexation on super tax cap as $3m threshold draws criticism
A senior executive in the superannuation technology sector has criticised the Federal Government for failing to index the proposed $3 million superannuation tax cap, arguing the measure will unfairly ...Read more
Superannuation
Rest members back calls for fairer superannuation rules ahead of Federal Budget
Rest has called on the Federal Government to implement superannuation reforms aimed at improving fairness across the system, after member survey results showed strong support for a range of proposed ...Read more
Superannuation
Rest welcomes progress on ‘Payday Super’ reform
Rest, one of Australia’s largest profit-to-member superannuation funds, has welcomed the Australian Government’s release of draft ‘Payday Super’ legislation, which aims to align Superannuation ...Read more
Superannuation
SuperAPI and Humanforce partner to improve superannuation compliance for one million Australians
Superannuation engagement platform SuperAPI has partnered with human capital management provider Humanforce to streamline payroll and superannuation contributions for more than one million Australian ...Read more
Superannuation
Rest super fund reports 11.19 per cent return for 2024
Rest superannuation fund delivered an 11.19 per cent return in its MySuper Growth investment option for calendar year 2024, marking two consecutive years of positive returns. Read more
Superannuation
Actuaries propose three-tier superannuation tax reform
The Actuaries Institute has outlined major reforms to Australia's $4.1 trillion superannuation system, proposing uniform tax rates and new levies on high retirement withdrawals. Read more
Superannuation
Election policies could reshape Australia's superannuation landscape, expert warns
Competing superannuation policies from Australia's major political parties could have significant implications for investors and retirees, according to a financial expert. Read more
Superannuation
Industry leaders weigh in on concessional super tax as Budget confirms $55bn investment
Changes to the taxation of superannuation earnings and contributions have drawn mixed responses from financial and payroll sector leaders, as the Federal Budget confirms over $55 billion in ...Read more
Superannuation
Call for indexation on super tax cap as $3m threshold draws criticism
A senior executive in the superannuation technology sector has criticised the Federal Government for failing to index the proposed $3 million superannuation tax cap, arguing the measure will unfairly ...Read more
Superannuation
Rest members back calls for fairer superannuation rules ahead of Federal Budget
Rest has called on the Federal Government to implement superannuation reforms aimed at improving fairness across the system, after member survey results showed strong support for a range of proposed ...Read more
Superannuation
Rest welcomes progress on ‘Payday Super’ reform
Rest, one of Australia’s largest profit-to-member superannuation funds, has welcomed the Australian Government’s release of draft ‘Payday Super’ legislation, which aims to align Superannuation ...Read more
Superannuation
SuperAPI and Humanforce partner to improve superannuation compliance for one million Australians
Superannuation engagement platform SuperAPI has partnered with human capital management provider Humanforce to streamline payroll and superannuation contributions for more than one million Australian ...Read more
Superannuation
Rest super fund reports 11.19 per cent return for 2024
Rest superannuation fund delivered an 11.19 per cent return in its MySuper Growth investment option for calendar year 2024, marking two consecutive years of positive returns. Read more
Superannuation
Actuaries propose three-tier superannuation tax reform
The Actuaries Institute has outlined major reforms to Australia's $4.1 trillion superannuation system, proposing uniform tax rates and new levies on high retirement withdrawals. Read more
