QSuper has segregated $10 billion in assets held for members in retirement to capitalise on greater tax efficiencies.

The change is expected to lead to asset re-weightings to take advantage of the absence of capital gains tax for pension assets. It is also part of a general move to optimise outcomes for different cohorts of members.

Rosemary Vilgan, chief executive of QSuper, sees the change as helping the fund tap into “enormous thinking” on the right way to invest accumulation assets compared to pension assets.

“Many of the investments will still be the same, but you could have different asset weightings particularly because of the tax impact,” she said.

The move was achieved after close work between QSuper and its custodian State Street Australia, its investment managers, advisers and specialist providers. It also sought input from APRA and ASIC.

The change could potentially benefit 17,000 QSuper members identified as having finished work and ceased contributions, but whose assets are not in drawdown.

Vilgan said: “We must think as a trustee and look at these peoples’ accounts and say ‘are we doing the best for you?’ Maybe they don’t want to [draw a pension] or the forms are too complicated.”

There are around 25-26,000 QSuper members receiving a pension income account, a further 5,000 members are working part-time and transitioning to retirement.

The segregation of accumulation and retirement assets comes a month before QSuper creates unique asset allocations for 440,000 members in eight cohorts, according to age and account balance.

Raewyn Williams, director – research and after-tax solutions, Australasia at Parametric, described QSuper’s move as market leading.

“Most funds have a relatively small percentage of pension assets (relative to accumulation) and can’t justify segregating because of the costs of segregating and ongoing give-up of the scale benefits of commingling the assets,” she said. “QSuper has something like $10 billion in pension assets so, unlike many funds, can justify it.”

Some of Williams’ work is involved in exploring the cost benefit analysis of such exercises for other funds and she saw QSuper’s move as a pre-cursor to other funds moving down the segregation path as they build scale in pension assets.

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