POWERED BY MOMENTUM MEDIA
Australian superannuation funds favour growth
Australian superannuation funds allocate more to growth assets than any other country in the Melbourne Mercer Global Pension Index.
The index, which covers 50 per cent of the world's population, showed the Australian super system had made little headway since 2011, with the index value increasing from 75.0 in 2011 to 75.7 in 2012.
Despite this, the country ranked third out of 18 countries in the index.
The slight improvement was driven by an increase in the level of pension fund assets and a rise in the labour force participation rate among those aged 55-64, the report said.
Mercer senior partner and author of the report, Dr David Knox, said countries' penchant for growth assets varied from zero, to over 70 per cent in Australia. He said there was no single asset allocation solution - but a diverse spread would provide better outcomes.
Knox said the move to increase compulsory superannuation contributions from 9 to 12 per cent would stand Australia in good stead to take out the top spot, but further reforms were necessary.
He said a requirement to withdraw part of a member's retirement savings as an income stream, and boosting the labour force participation rate among older workers, were factors that could improve the Australian system.
Similar to suggestions made by The Actuaries Institute, Knox advocated a mechanism to increase the pension age as life expectancy increased, and gradually raising the preservation age.
Denmark took out the top spot in the index and was the first country to receive an 'A' rating and index value of 82.9.
AUTHOR
Staff Writer
Money Management staff writers are writers who contribute to the website from time to time. If you would like to discuss the content contained within this article please contact us.
Recommended for you
Governor Michele Bullock took a more hawkish stance on Tuesday, raising concerns over Donald Trump’s escalating tariffs, which sent economists in different directions with their predictions.
Equity Trustees has announced the appointment of Jocelyn Furlan to the Superannuation Limited (ETSL) and HTFS Nominees Pty Ltd (HTFS) boards, which have oversight of one of the companies’ fastest growing trustee services.
Following growing criticism of the superannuation industry’s influence on capital markets and its increasing exposure to private assets, as well as regulators’ concerns about potential risks to financial stability, ASFA has released new research pushing back on these narratives.
A US-based infrastructure specialist has welcomed the $93 billion fund as a cornerstone investor.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
GAM LSA Private Shares AU I
37.08 3 y p.a(%)
2
DomaCom Lot 21 Chellaston Road Munno Para West SA 5115 Australia
32.63 3 y p.a(%)
3
Fidante Credit Suisse Global Private Equity
32.16 3 y p.a(%)
4
Global X GlobalX FANG+ ETF
28.28 3 y p.a(%)
5
Plato Global Alpha A
27.76 3 y p.a(%)
