The 16 Industry
SuperFunds operating in Australia are run only to benefit members, have
low fees and never pay commissions to financial planners.
They have
long had the reputation of performing well for members, so that a worker retires
with a larger super balance than if he/she had joined a retail fund.
Needless to say that reputation is pooh poohed by a good many Liberal and Nationals politicians whenever the subject of compulsory superannuation came up.
It appears that it will now be harder for those same politicians to take that attitude now.
The Australian, 19 January, p.5:
Every one of the 50
worst-performing balanced superannuation investments over seven years has been
operated by retail funds such as ANZ, Westpac and IOOF, with just one
product offered by the for-profit sector making it onto the list of the top 135
performers.
In revelations that
categorically bring to an end the fierce three-decade dispute between retail
and industry funds over which is superior, secretive and highly
detailed industry data obtained by The Weekend Australian shows that regardless
of the investment timeframe or level of risk involved, retail funds are
unquestionably consistently at the bottom and industry funds are
consistently at the top.
Despite every worker
being forced to divert a portion of every pay packet into compulsory super since
it was introduced in 1992 — and the key choice most people face being whether
to invest in an industry fund or a retail fund — no list of
worst-performing super investments has ever been made public, with
analyst companies refusing to release them.
Retail and
industry funds account for more than $1.28 trillion of the nation’s
retirement savings and the revelations back renewed calls from federal minister
Kelly O’Dwyer this week for the creation of a Future Fund-style national
retirement fund to keep the nation’s super savings out of the
hands of the “many rent seekers and ticket clippers” in the sector.
The highly detailed data
from SuperRatings, considered the most comprehensive and accurate in the nation
and used by the Productivity Commission in preparing last week’s report into
the $2.8tn sector, lists 278 “balanced” super options offered by the
nation’s retail and industry funds.
Over the seven years to
March 2018, of all funds in “accumulation” phase, where the member is
still working, the 50 worst-performing were all operated by retail funds and
all but one of the 17 worst performers were managed by Westpac’s BT or ANZ’s OnePath….
Retail funds have
for many years argued APRA data showing their poor performance can’t be used to
judge them because it looks at only the overall performance of “funds”, which
usually operate numerous different investment options.This SuperRatings data
specifically examines those individual options, negating that argument.
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