SUPERANNUATION – AUSTRALIA

Big super ready to fund infrastructure

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Original article by Joanna Mather
The Australian Financial Review – Page: 7 : 9-Jul-19

IFM Investors CEO Brett Himbury has argued the case for industry superannuation funds to invest in public infrastructure, saying they are prepared to buy into both new and existing assets. Himbury concedes that there is still some concern about the partial sale of public assets; however, he stresses that unlike some private investors, super funds are focused on long-term returns rather than short-term profits. Former ACTU secretary Bill Kelty has proposed the creation of a new government-backed asset class that is focused on infrastructure.

CORPORATES
IFM INVESTORS PTY LTD, ACTU, INFRADEBT PTY LTD

Industry Funds increasing lead in satisfaction over Retail Funds – Unisuper the top performer

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Original article by Roy Morgan
Market Research Update – Page: Online : 8-Jul-19

New research by Roy Morgan shows that in the six months to May 2019, satisfaction with the financial performance of industry superannuation funds was 62.5% (up 0.5% points from the same period 12 months ago), compared with 56.5% for retail super funds (down 3.7% points). Satisfaction with retail funds was 1.8% below that of industry funds in 2018, and this gap has now increased to 6.0%. Ten of the top 12 performing super funds in May 2019, based on member satisfaction with their financial performance, were industry funds. The highest rating was for Unisuper (70.9%), followed by Tasplan on 69.6%. The only two retail funds to make it to the top 12 were Macquarie with 66.6% and Mercer on 64.3%. These results are from the newly released Roy Morgan report ‘Satisfaction with Financial Performance of Superannuation in Australia’, May 2019 edition. The data in this report represents some of the findings from Roy Morgan’s Single Source survey, which is based on in-depth interviews conducted face-to-face with over 50,000 consumers per annum in their homes, including over 30,000 with superannuation. These results are based on interviews conducted in the six months to May 2019.

CORPORATES
ROY MORGAN LIMITED, CATHOLIC SUPER, UNISUPER LIMITED, MACQUARIE SUPERANNUATION, COLONIAL FIRST STATE SUPER

Super returns can’t last forever: Chant West

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Original article by Andrew White
The Australian – Page: 31 : 28-Jun-19

Data from Chant West shows that the median growth superannuation fund is on track to deliver a return of 7.1 per cent for 2018-19. It would be the 10th year of positive returns after big losses in 2008 and 2009 due to the global financial crisis. However, Mano Mohankumar of Chant West cautions that the strong performance may not be sustained, noting that super funds have in effect simply been recovering from the financial crisis, while the sector faces a number of headwinds.

CORPORATES
CHANT WEST FINANCIAL SERVICES PTY LTD, STANDARD AND POOR’S ASX 200 INDEX

AMP hit with new class action

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Original article by Samantha Bailey
The Australian – Page: 20 : 27-Jun-19

AMP says it will "vigorously" defend a class action launched by law firm Slater & Gordon, which alleges that superannuation fund members were charged excessive fees. Slater & Gordon is the second law firm to file a class action on behalf of AMP’s super fund members, with Maurice Blackburn having done so in May. Maurice Blackburn is also pursuing a separate class action against AMP over its compliance with disclosure obligations.

CORPORATES
AMP LIMITED – ASX AMP, SLATER AND GORDON LIMITED – ASX SGH, MAURICE BLACKBURN PTY LTD, THERIUM LITIGATION FINANCE

Super funds seek energy policy action

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Original article by Perry Williams
The Australian – Page: 17 & 28 : 25-Jun-19

Industry Super Australia says the nation’s energy policy needs to be overhauled quickly to prevent heavy industries going offshore. ISA contends that the amount of investment needed in electricity should be attracting the interest of portfolio investors, but a lack of certainty on energy policy means this is not occurring. ISA says there should be a focus on the creation of competition for long-term supply of energy and capacity at specified emissions targets, as well as the formation of special investment vehicles to encourage investment in the energy sector.

CORPORATES
INDUSTRY SUPER AUSTRALIA PTY LTD

Super system far too complex

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Original article by Adam Creighton
The Australian – Page: 17 & 20 : 24-Jun-19

Nobel Prize-winning economists Eugene Fama and Richard Thaler contend that Australia’s superannuation system has too many investment options and that its fees are too high. Fama says low-fee passive funds should be the default option in a system that is government-mandated, while Thaler says lower fees should be achievable through competitive bidding. Treasurer Josh Frydenberg recently announced a new review of the $2.8 trillion superannuation sector.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIA. PRODUCTIVITY COMMISSION, RAINMAKER INFORMATION SERVICES PTY LTD

Balanced super ahead for 10th year

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Original article by Natasha Gillezeau
The Australian Financial Review – Page: 8 : 17-Jun-19

Data from SuperRatings shows that the average balanced superannuation fund achieved a return of -0.7 per cent in May. However, the average return for balanced options so far in 2018-19 is 5.1 per cent, putting the sector on track to deliver a positive return for the financial year. SuperRatings executive director Kirby Rappell notes that the return for median balanced super funds is about 8.5 per cent over the last 10 years.

CORPORATES
SUPERRATINGS PTY LTD

Room for unions to work with super funds: Combet

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Original article by Ewin Hannan
The Australian – Page: 2 : 18-Apr-19

Industry Super Australia chairman Greg Combet says he has no concerns with union officials raising industrial relations issues with trustees of superannuation funds. However, he stresses that trustees must be mindful of their duty to act in the best interest of fund members when considering such issues. The Australian Prudential Regulation Authority recent advised that trustees must not be influenced by "sponsoring organisations" in carrying out their duties. Combet has previously been ACTU secretary and a Labor minister.

CORPORATES
INDUSTRY SUPER AUSTRALIA PTY LTD, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, ACTU, AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE TREASURY, IFM INVESTORS PTY LTD, BHP GROUP LIMITED – ASX BHP, BLUESCOPE STEEL LIMITED – ASX BSL, AUSTRALIANSUPER PTY LTD, GLENCORE PLC

Feast of double-digit super returns is over

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Original article by James Kirby
The Australian – Page: 26 : 17-Apr-19

New data shows that both balanced and growth superannuation funds achieved a return of just 0.8 per cent in March. The low returns mean super funds may struggle to deliver strong returns for the financial year, after global financial market volatility weighed on returns in the December quarter. Super funds have returned an average of just 3.2 per cent so far in 2018-19, and balanced funds are now unlikely to maintain their recent track record of double-digit returns for the full year.

CORPORATES
SUPERRATINGS PTY LTD, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, RESERVE BANK OF AUSTRALIA

Industry funds to reach $2trn within 10 years

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Original article by Joanna Mather
The Australian Financial Review – Page: 3 : 16-Apr-19

KPMG has forecast that Australia’s superannuation industry will boast $5.4trn worth of funds under management by 2029, compared with just $2.7trn at present. The firm’s 2019 Super Insights report also forecasts that industry funds will manage $2trn in 2029, up from $631bn in 2019. Paul Howes of KPMG says union-backed industry funds must ensure that they comply with the ‘sole-purpose test’ as their dominance of the super industry increases.

CORPORATES
KPMG AUSTRALIA PTY LTD, AUSTRALIANSUPER PTY LTD, SUNSUPER PTY LTD, HOST-PLUS, AUSTRALIAN WORKERS’ UNION-FEDERATION OF INDUSTRIAL, MANUFACTURING AND ENGINEERING EMPLOYEES, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIA. DEPT OF THE TREASURY, MLC LIMITED, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, BT FINANCIAL GROUP PTY LTD, WESTPAC BANKING CORPORATION – ASX WBC, BHP GROUP LIMITED – ASX BHP