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Just super: Council workers are wise with their money in superannuation stakes

Council workers have been a major beneficiary of a strong performance by their superannuation funds in the last financial year, but regulators have been scathing in their review of the sector.

Jul 18, 2023, updated Jul 18, 2023
A council worker collects rubbish bins (AAP Image/Mick Tsikas)

A council worker collects rubbish bins (AAP Image/Mick Tsikas)

The best-performing balanced fund was a small Victorian fund ESSSuper that services local government workers. It returned 13.3 per cent. Brighter Super, the Brisbane-based fund that has a history in local government was third best with a 10.6 per cent return.

However, Brighter’s higher-risk growth option produced a 12-month return of 12.61 per cent to June 30.

Brighter Super is a merger of LGIAsuper, Energy Super and Suncorp Super, and is the fourth biggest non-government financial services entity in Queensland.

UniSuper, which serves the higher education sector was fourth with 10.4 per cent while Australian Retirement Trust was sixth with 10 per cent. However, over 10 years ART was a joint leader with UniSuper at 8.4 per cent.

Brighter Super chief executive Kate Farrar said the previous merger of LGIAsuper and Energy Super in 2021, had enabled the fund to make improvements in its investment capabilities and to take advantage of market conditions and set members up for growth.

Brighter Super Chief Investment Officer Mark Rider said the strong returns were driven by the recovery in equity markets. Australian equities are up sharply over the past financial year and returns from international equities have been even stronger.’’

Mr Rider said Brighter Super had been overweight in listed equities relative to its major peers and underweight in private equity in the MySuper option. Its infrastructure and credit portfolios also performed strongly.

“There has been a consistency across the performance of the fund,’’ he said.

A review of superannuation trustee performances found more needed to be done to improve long term outcomes for members approaching retirement.

The review, by ASIC and APRA, examined the progress of 15 trustees and looked at whether they understood the needs of members, how they offered assistance and how they executed and oversaw their strategy.

It found there was a variability in the quality of the approaches take and a lack or urgency in embracing the intent of the Retirement Income Covenant.

All trustees had gaps in critical information they needed on members and some were not using metrics to track how their members were using assistance measures and their effectiveness.

Top 10 funds 2022-2023 performance

ESSSuper (basic growth) 13.3 per cent

Vision SS (balanced growth) 11 per cent

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Brighter Super accumulation (balanced) 10.6 per cent

UniSuper (balanced) 10.3 per cent

Equip Super (balanced growth) 10.1 per cent

ART (balanced) 10 per cent

IOOF Employer Super Core (Multiseries 70) 9.8 per cent

Aware Super Future Saver (balanced) 9.7 per cent

Mercer Super Trust (Mercer Select Growth) 9.6 per cent

Hesta (balanced growth) 9.6 per cent

*Source: Super Ratings

 

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