Last week there were two events that received differing levels of publicity.
The midyear economic review received a lot of media attention but did not have a big impact. The other, the SuperRatings annual awards recognising the best Australian super funds, received little to no publicity but affects every working Australian.
Anyone who receives the benefit of super contributions, and wants to maximise their income in retirement, needs to ensure that their superannuation fund is the best it can be. This is what the SuperRatings awards are all about.
The major benefit of the awards is not who wins each year. Instead it comes from the process of rating the superannuation funds. The company behind the awards, SuperRatings Pty Ltd, as a part of the awards process analyses more than 1000 aspects of each super fund's operations and rates them accordingly.
They look at every aspect of a super fund's operations including investments, administration, fees, member services, advice, education and insurance. Each component of the operations is benchmarked against best practice for the superannuation industry and awarded a score.
Each fund is given a rating depending on its total score. The ratings go from platinum, for the top-rated funds, down through gold, silver, and to other for the bottom-rated funds. Funds that have a true focus on delivering benefits to members, when rated at below average, take this as an opportunity to improve their overall service offering and performance.
The contribution of SuperRatings in improving superannuation is widely acknowledged among the industry.
Former AGEST Super chief executive Michael Seton said: "The very presence of an independent party [SuperRatings] who carries out research on super funds and rates them, without fear or favour, has in my view lifted the performance, transparency and member focus of superannuation funds around Australia."
The rating of superannuation funds has been carried out by SuperRatings for 10 years. Of the more than 300 super funds rated since SuperRatings started the benchmarking service, only four have achieved a platinum rating in each of the 10 years. Those funds are AustralianSuper HESTA REST and Sunsuper.
The three main awards handed out last week were:
Pension fund of the year to Hostplus Pension
Accumulation fund of the year to AustralianSuper, and
Superannuation fund of the year to Sunsuper.
Of the eight awards presented on the night only two went to public-offer commercial funds with the rest going to industry funds. ING Direct Living Super won the best new product award and Asgard Infinity eWrap won the award for the fastest growing fund in the industry.
Despite an industry fund winning the pension fund of the year, because of its performance across all operating standards, SuperRatings publicly acknowledges that industry funds have a long way to go to have pension fund performance match that of their accumulation funds.
SuperRatings managing director Jeff Bresnahan said: "While they took some years to realise what an important piece of the puzzle pension offerings were, many of the funds are now trying to move ahead in leaps and bounds in terms of the depth of their offerings."
Two of the main areas where this deficiency is evident are the choice of investments offered to members of pension funds and the ability for members to have income generated from investments paid into a cash account that pays their pension.
Of the 74 industry pension funds assessed, only one, Telstra Pension Diversified Income option, offers this income option.
The transparency and focus on fund performance by SuperRatings will add more to the quality of most Australians' retirement than any government initiative.