The assignment does not mean that Frontier is embarking down the implemented consulting road taken by most of its competitors, according to deputy managing director Kristian Fok. “We’ll be assisting IFS on a flat-fee basis, like any other of our clients,” Fok said. The platform was mentioned in an address by IFS chief executive Kay Thawley to the Conference of Major Superannuation Funds (CMSF) last month, in a session where three-quarters of the fund representatives in attendance said their fund planned to substantially increase their advice services over the next three years. Having helped neutralise the commissions debate, the industry funds are now under pressure to prove that their offerings are superior to retail master trusts in terms of performance, service and overall value for fees paid.
The bank-owned wealth managers have emerged with MySuper-ready funds with a lower price tag than many industry funds, such as the 119-option Colonial FirstChoice Wholesale – now welcoming balances as low as $1500 – and AMP’s Flexible Super range, although this was castigated at CMSF by HESTA chief executive Anne-Marie Corboy as a stepping-stone to more expensive products. The development of a platform is just one way the industry funds sector is seeking to beat the master trusts at their own game. AustralianSuper and CareSuper are extending their direct share trading choice options to the ASX300, and introducing live trading as opposed to the clunky weekly settlements that previously applied. With an eye to the banks themselves, meanwhile, industry fund-owned Members Equity Bank recently packaged together its home loan, offset transaction account and MasterCard offerings together for the first time, in a bid to regain market share in the $200,000- $600,000 loan size space. The variable rate is 7.09 per cent for all loan sizes, while the three-year fixed rate is 7.25 per cent, which ME claims is the second-cheapest in the entire market.