Transport Super has merged with MyLife MySuper as part of a master trust, effective from December 1, 2016.
The $114 million non-public offer industry fund for transportation workers had a five-year compound average return of 6.83 per cent for its balanced accumulation option, but only returned 0.27 per cent in the 2016 financial year. Its balanced pension option performed even worse, returning negative 0.75 per cent.
Research by consulting firm Third Horizon showed that in 2015 Transport Super had a decline in market share of assets, a decline in market share of members, and net contribution outflows. Twenty-two other funds showed similar characteristics in that year, including Mercer, MLC, Meat Industry Super, Equipsuper, Qantas Super and the Commonwealth Super Scheme, though a number of them have deployed new strategies to counter these trends.
The Australian Prudential Regulation Authority has been keen for more mergers to take place for years, with chair Helen Rowell particularly concerned with those funds that were shrinking. In recent speeches, she has signalled the regulator will be tougher on this issue.
Many pension experts and academics also agree that super funds need to be minimum size to capture economies of scale – with mergers a possible way to achieve this – though there is debate at what level this should be.
Former Transport Super chair Graham Hart, who has stepped down because of the restructure from the merger, said, “I have confidence that this transfer is a strong new step for both funds as we look toward the future.”
MyLife MySuper is a division of MyLifeMyMoney Superannuation Fund, which was originally called Catholic Superannuation Fund.
In 2015, the Catholic Superannuation Fund trustees took the decision to restructure and rename the fund into a master trust, as they wanted to broaden the services beyond superannuation into other markets. This includes financial planning and a newly launched business that offers a range of banking products.
Under this master trust arrangement, the brand of Catholic Super still exists, but is run by MyLifeMyMoney. Transport Super is also now part of the MyLife MySuper division.
MyLifeMyMoney is currently managing $7.3 billion on behalf of approximately 8000 businesses and 77,000 members.