Industry super funds praised as great success story
David Whiteley, chief executive of the Industry Super Network, said industry funds - with equal board representation for employers and employees - were a "fine example of the consensus upon which this nation is built".
They had "outperformed their retail fund rivals, largely the major banks, by between 1 and 2 per cent per year on average over the past 10 years", Mr Whiteley told a Sydney audience on Thursday. "This is attributed to their non-commissions, low fees, all profits to members' model, and also asset allocation, principally investment in unlisted property and infrastructure."
Australia's total superannuation assets are estimated to have grown by 13.5 per cent over the year to March 31 to $1.58 trillion. Industry super funds account for 19.8 per cent of total assets, "retail funds" run by banks had 26.3 per cent, and the largest group was self-managed funds, with 31.5 per cent.
ISN said industry super funds could invest $15 billion over the next five years into infrastructure, providing state governments with much-needed money and matching super's long-term focus with the country's growing infrastructure needs.
But despite super's growth, Brad Cooper, the head of Westpac's wealth arm BT Financial Group, said in Melbourne this month that just 20 per cent of retirees would be fully self-sufficient in 2035 - about the same ratio as now. "In fact, what grows is the proportion of people who will be partially self-funded but still relying on the pension."
Mr Whiteley also stepped up the rhetoric against further changes to super, fresh from the Coalition's announcement that if it wins the election, it would defer the rise in the compulsory super guarantee to 12 per cent by two years.
"In the not-too-distant future people will pay as much attention to superannuation policy changes as they might to announcements on interest rates ... There are very real concerns policymakers will realise too late that iterative change could create permanent damage to confidence in the system," he said.
Frequently Asked Questions about this Article…
Industry super funds are not-for-profit retirement funds that typically have equal board representation for employers and employees. The Industry Super Network’s chief executive, David Whiteley, called them a “great Australian success story,” highlighting their member-focused model, low fees, non-commission structures and long-term asset allocation that have driven strong outcomes for members.
According to Industry Super Network comments in the article, industry super funds have outperformed retail funds run by major banks by about 1–2% per year on average over the past 10 years.
The article attributes industry funds’ outperformance to their non-commission business model, relatively low fees, an “all profits to members” approach, and asset allocation choices—particularly investment in unlisted property and infrastructure.
Australia’s total superannuation assets were estimated to have grown 13.5% in the year to March 31 to about $1.58 trillion. Industry super funds account for around 19.8% of total assets, retail bank-run funds about 26.3%, and self-managed super funds roughly 31.5%.
Yes. The Industry Super Network said industry super funds could invest around $15 billion over the next five years into infrastructure, providing state governments with funding that suits superannuation’s long-term investment horizon.
The article notes the Coalition announced it would defer the rise in the compulsory super guarantee to 12% by two years if elected. Industry representatives warned that iterative policy changes like this could harm confidence in the superannuation system if not handled carefully.
Brad Cooper, head of Westpac’s wealth arm BT Financial Group, said only about 20% of retirees would be fully self-sufficient in 2035—roughly the same proportion as today—while a larger share may be partially self-funded but still rely on the pension.
The article points out industry funds typically have equal representation for employers and employees on boards, which David Whiteley described as a strong example of national consensus. Board composition is expected to be a focus of policy debate, since governance arrangements can influence fund strategy, member outcomes and public confidence.
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