If workplace superannuation is to continue to be an important part of an employer’s value proposition, the way it is supported and promoted will become increasingly important, according to leading actuarial research house, Rice Warner.
In an analysis of the Government’s new superannuation stapling proposals, Rice Warner acknowledged that stapling has the potential to reshape the superannuation landscape but, at the same time, not necessarily represent the death of workplace super.
The analysis said that while stapling might represent the death of default superannuation, this was not necessarily the case with respect to workplace superannuation particularly if funds and employers were innovative in terms of seeking to attract members.
“Employers may treat their employees’ superannuation fund like a bank account – where they make the contribution with little care for where it goes. If workplace superannuation is to continue to be an important part of an employer’s value proposition, the way it is supported and promoted will become increasingly important,” the Rice Warner analysis said.
“The typical workplace distribution channel for superannuation funds will undoubtedly shift. Funds will need to look for new methods to seek new members. Funds may consider targeting family members of existing members or look to see what inducements they can offer to bring in new members.
“For the funds that adapt to this new environment, we expect higher levels of retention and longer membership duration. This will likely lead to larger balances and higher levels of engagement. Funds may need to consider their fee structure and member engagement proposition as member demographics shift,” it said.
