AMP Limited has positioned itself to handle the new choice of funds environment announcing this week that it is reducing fees on its major superannuation and pension products.
AMP claims the fee reductions are the largest ever undertaken by AMP averaging 10 per cent for Flexible Lifetime – Superannuation products, 6 per cent for CustomSuper and 5 per cent for Flexible Lifetime – Allocated Pensions.
It says the reductions will take full effect from the beginning of November, with Managing Director of AMP Financial Services, Craig Dunn saying they represent the passing on of cost savings achieved in recent fee negotiations with fund managers.
“The $40 million pre-tax reduction being passed on to customers has been funded from both cost savings and fund manager fee negotiations,” Dunn says. “This demonstrates how AMP has been able to take advantage of its scale position in the market, for the benefit of both shareholders and customers.”
He says customers will benefit to varying degrees from the changes, according to the dollar size of their investment balance and the investment options selected.
Dunn acknowledged the influence of recent legislative and regulatory changes, saying choice of fund and more transparent fee disclosure are likely to make the market increasingly competitive.
“These fee reductions put us on the front foot and, combined with the strength of our planning distribution network, position us well in preparing for the new regulatory framework and making us more competitive to customers,” he says.
