News
Leading industry and retail funds dominate choice
High-profile industry funds and well-established retail brands are the most popular choice for Australians who decide to shift their superannuation, according to a choice-of-funds analysis.
Figures collated by leading service provider InvestmentLink show consumers are choosing known brands over newer market entrants and niche funds.
InvestmentLink Chief Executive Peter Philip said the figures had significant implications for the superannuation industry, especially smaller funds aspiring to grow membership and funds under management.
"Established retail brands such as AMP, ING, MLC, BT, Colonial First State, AXA and ASGARD, and industry funds including Australian Super, REST, SunSuper, CBUS and Host-Plus, are the most popular funds when Australians make a choice," Mr Philip said.
"Australians who choose their superannuation fund are opting for well-known brands over smaller funds and newer entrants such as Virgin, which represents 0.5 per cent of choice."
| Fund | December 2006 |
|---|---|
| Australian Super | 15.36% |
| AMP | 10.37% |
| CFS/CBA | 5.43% |
| REST | 5.08% |
| ING/ANZ | 4.83% |
| SunSuper | 4.73% |
| MLC/NAB | 4.64% |
| Host Plus | 3.51% |
| BT/Westpac | 3.16% |
| AXA | 2.84% |
| CBUS | 2.23% |
| ASGARD | 2.05% |
| CARE | 2.00% |
| LUCRF | 2.00% |
| HESTA | 1.96% |
| MTAA | 1.50% |
| Total - top 16# | 71.69% |
# These percentages reflect the number of members that have made choices for the above providers in the first 18 months of choice.
InvestmentLink's experience with nearly 1.2 million active superannuation accounts - one of the largest samples available and representing 12 per cent of working Australians - shows nearly 7 per cent of members had exercised choice through the SuperChoice electronic clearing service in the first 18 months of choice.
Mr Philip said a more accurate reflection of the levels of choice was 10 to 15 per cent of the eligible population when small to medium employers were taken into account.
"The industry fund advertising campaign has been highly effective in selling the main industry funds - they have developed an enviable brand profile," he said.
"However, we conclude that choice-of-fund figures point to the likelihood of further consolidation in the industry and a growing number of industry funds seeking public offer licences to help them gain, rather than simply retain, members.
Mr Philip said SuperChoice figures show one in four employees joining a new employer were making a choice not to opt for the employer's default fund, and elections for Self Managed Super Funds (SMSFs) represented just under 5 per cent of all members.
Stay in Touch
Subscribe to our InvestmentLink e-News newsletter through our Information Library website.