First State Super opened its doors to the public for the first time yesterday, taking the $11 billion fund for NSW Government employees into a new era where it is able to retain members for life.

Previously the fund has lost about 30,000 of its 450,000 members a year, due primarily to job changes. About two-thirds of the members are employed in the health or education sectors. According to Michael Dwyer, the fund’s chief executive, up to 70 per cent of members who would otherwise exit the fund will be retained under the new public offer status. The change has been brought about in order to help the fund’s future growth, in order to keep costs down, by servicing its existing membership base rather than actively looking outside for new members, Dwyer says. The process to move to public offer status commenced last year when the NSW Government introduced legislation in November to move First State to the SIS regulatory environment. The fund then applied for an ASIC license and, finally, an APRA licence, which was granted last week. A formal re-launch for the fund is to take place on Thursday at Sydney’s Westin Hotel. Dwyer says that most members will not notice any change with the fund. “We want to continue to offer good returns and low fees,” he says. “But research showed us that many family members had also wanted to join the fund and many people who moved out of the public sector wanted to stay with the fund… We’re not going in for a big campaign. We will be marketing through our membership base.” The fund currently offers no post-retirement investment products nor financial planning services. First State has been rated by SuperRatings, Chant West and Rainmaker. As a SIS-regulated fund, members will now have access to the Superannuation Complaints Tribunal if they have a problem with the fund. And from the fund’s perspective, it will no longer have to submit its annual report for tabling in Parliament. The make-up of its board, chaired by former academic Tom Parry, may also change in time.

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