Super fund expenses decrease

23 February 2017
| By Jassmyn |
image
image
expand image

While compliance and marketing and communications expenses have increased for all superannuation funds, technology spend has decreased, according to Rice Warner.

The research house’s ‘Superannuation Expense Benchmarking’ survey also found that in line with previous years, retail funds had the highest operating expenses per member over the year to 30 June 2015, and industry funds the lowest.

Public sector funds experienced a low increase to experience per member with corporate funds being the only sector that experienced a decrease, a result from a declining population as the more expensive smaller company funds have outsourced to multi-employer funds.

Rice Warner said technology expenses decreased by 29 per cent mainly due to SuperStream related projects being completed or wound down.

“The report illustrates that overall operating expense for the peer group decreased over the year to 30 June 2015. The savings are being used to improve product design and features for members,” the report said.

Compliance expenses increased by 29 per cent and had been increasing at a steady rate since 2013.

“This can be attributed to the new APRA [Australian Prudential Regulation Authority] reporting standards. As a result, funds are increasing the size of their compliance teams to meet growing board, regulator and community expectations around risk management and governance,” the report said.

Marketing and communication costs increased by 17 per cent and had become a large component of super fund expense budgets over the past decade.

“Many of the differentiating features of funds have become common place, while aspects that used to define industry segments have become blurred,” the report said.

“At the same time, many funds are putting in place strategies to grow their membership numbers inorganically which comes at a cost.”

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest developments in Super Review! Anytime, Anywhere!

Grant Banner

From my perspective, 40- 50% of people are likely going to be deeply unhappy about how long they actually live. ...

1 year 4 months ago
Kevin Gorman

Super director remuneration ...

1 year 4 months ago
Anthony Asher

No doubt true, but most of it is still because over 45’s have been upgrading their houses with 30 year mortgages. Money ...

1 year 4 months ago

Future Group is set to take on nearly $1 billion in funds under management (FUM) and welcome more than 100,000 new members following two significant successor fund transf...

2 days 1 hour ago

The International Monetary Fund (IMF) has issued a sobering assessment of the global economic landscape in its latest World Economic Outlook, dramatically revised after D...

2 days 3 hours ago

Growth from the listed company’s key businesses has propelled Generational Development Group to new milestones in the three months to 31 March....

2 days 3 hours ago

TOP PERFORMING FUNDS

ACS FIXED INT - AUSTRALIA/GLOBAL BOND