The market researcher’s report, Satisfaction with Financial Performance of Superannuation in Australia, found that the industry faction scored 62.5 per cent during the six months leading up to May, while retail funds averaged at 56.6 per cent.
The 6 percentage point gap in satisfaction is up from a difference of 1.8 percentage points 12 months prior. Additionally, 10 of the top 12 performing funds were industry funds.
UniSuper was reported to be the top performer in the sector with 70.9 per cent customer satisfaction, followed by Tasplan with 69.9 per cent.
The only two retail funds that were seen to rise to the top were Macquarie with 66.6 per cent customer satisfaction and Mercer with 64.3 per cent. Sunsuper was at the bottom of the top range at 58.2 per cent.
“As superannuation is a very long-term process, it is very likely that over a number of decades there will be the potential for a large number of ranking changes,” Norman Morris, industry communications director, said.
“This will present a major challenge for funds to remain in top position over such a long period.”
Roy Morgan noted the lowest satisfaction for major super funds beyond the 12 best performers were AMP (49.3 per cent), ASGARD (50.9 per cent) and BT (52.2 per cent).
The largest improvements in satisfaction reported among the top 12 over the last year were from Mercer (increasing 8.9 percentage points), Macquarie (up 3.5 percentage points) and First State Super (up 3.1 percentage points).
The fund showing the largest decline was Catholic Super, which was down 10.9 percentage points.
3. Why is the industry perpetuating this ‘us vs them’ mentality?
It’s not useful. Both industry funds and retail funds have their place and both will be useful and suitable for different clients. If you are an advsier and are staunchly against one and for the other, then it is you who is flawed, not the other type of fund. BOTH serve a useful purpose and will suit different clientele and who cares which is more popular with the masses, those who seek and pay for professional advice will take it over and above these stupid surveys which most people outside our industry will never see of read or hear about.
2. Industry funds are built for the masses, that is the bulk of people, which means surveys that rely on masses will tend to favour them also. It’s a flawed survey. Unless you survey people who use both and ask which they prefer or you survey the same number of each and ask them to rate their provider, then inevitably in a world where the majority have a industry fund, if you survey a sample of the population and 60% of that population has an industry fund and everyone across the board rates their fund a 7 out of 10, then you get 60% of people still being happy with industry funds. Surveys mean nothing most of the time.
Gee, lots of points I want to make here:
1. This article is a great example of the problem. The research related to “Satisfaction with Financial Performance of Superannuation in Australia” that is PERFORMANCE SATISFACTION, which of course is currently better with industry funds where many have excess unlisted assets or significant portions in index funds which have recently (and always will) outperform in the later stages of a bull market. I’ll bet the story is different with broader satisfaction re service also. As an adviser I have my fair share of gripes with retail funds service but I’d be happier dealing with a bad retail fund for a rollover, to get info, etc over a good industry fund any day!
Great marketing by industry funds… one size fits all.. low grade insurance offer… DIY strategy for members.. general advice disguised as person advice… and a vertically integrated business model that seems to put them ahead of members (and conflicts with BID)… yes, I trust an industry fund as far as I could kick them.