A merger of superannuation funds QSuper and Sunsuper may be in the works, with the funds confirming early discussions.
A joint statement by QSuper and Sunsuper confirmed the “preliminary, non-binding discussions about a possible partnership”.
“There is an absolute responsibility upon Trustees to consider how to best serve their members’ interests. Whether a partnership between our two funds could be better for both QSuper and Sunsuper members is an appropriate enquiry,” said the joint statement by QSuper Chair Karl Morris and Sunsuper Chair Andrew Fraser.
“Whether or not that consideration proceeds beyond preliminary discussions is dependent on many factors. In the meantime, both Sunsuper and QSuper members may be assured they will be kept informed of any material decisions.”
As at the end of June 2019, the funds between them had over 2 million members and $181.3 billion in assets. A merger would make the resulting fund one of the largest in Australia, by either measure.
A further statement put out by Sunsuper alone, seemingly aimed at members, was more circumspect than the joint statement. “It is not uncommon from time-to-time for Sunsuper to explore opportunities with other super funds where the result of a partnership would be of benefit to you, our members, and we can confirm that we have entered into very early, discussions with QSuper about a possible alliance,” it said.
“While the discussions are ongoing, you can rest assured that, as stewards of your hard earned retirement savings, it is business as usual at Sunsuper. As a profit-for-members fund, we have an obligation to always act in your best interests and we see it as a privilege to serve the 1.4 million Australians, like you, who trust us with their super savings. We will keep you informed of any material decisions that may impact you as a result of these discussions.”
The merger of Hostplus and Club Super was completed last week.
The pressure for super fund mergers has been building, including from APRA.
The Productivity Commission, in its report on superannuation, recommended increased disclosure of merger discussions to APRA.
“For mergers that ultimately do not proceed, the board should be required to disclose to APRA (at the time) the reasons why the merger did not proceed, and the members’ best interests assessment that informed the decision. APRA should also be empowered to prevent mergers that are not in members’ best interests.”
The Productivity Commission says that “there has not been a government response to this inquiry yet”.
The Financial Services Royal Commission also looked at mergers between super funds. While not making a recommendation, it did note that the question must be if the merger is in the best interest of members.
“The determining question cannot be whether one or more of those who are directors before the merger will have a place on the new board.”