Qantas Super has issued an update on its merger process, first announced in September.
Its merger committee held its first meeting on 9 November, led by chair John Atkin and directors Lorraine Berends, Luke Murray, Klair Safier, and Richard Garner.
The trustee board of the corporate super fund felt a merger is in the best interests of members for the purpose of competition and economics of scale, legislation, and sustainability reasons.
For these reasons, the fund felt it would be best to explore merger options while the fund has competitive investment performance and products rather than wait until they are forced to by APRA in the future.
It highlighted the fund is likely to grow at a slower rate than its competitors as it only has one membership base, has less ability to reduce fees for members, and the impact of COVID-19 on its workforce.
“The following factors have been important considerations: larger super funds deal with thousands of employer groups and we only deal with one, COVID-19 dramatically changed the demographics of Qantas Super’s membership, legislative changes mean Qantas Super will likely grow less than planned, etc.” it said.
“As such we think our members would likely be better served by being part of a larger super fund with a broader membership and a healthier cash flow profile.”
The $8.4 billion fund is one of Australia’s largest corporate superannuation funds with some 26,300 members. It was established in 1939 for people who are working for, or have worked for, the Qantas Group, and their spouses.
In a statement, the fund said: “Our CEO Michael Clancy and several directors have met with various unions who count Qantas Super members among their own membership, to discuss the reasons why we are undertaking this process. We’ve also communicated with our various service providers and APRA.
“All of these exchanges have been useful for the trustee and we’re listening carefully to the feedback we’re receiving.”
An earlier note from union ASU stated it had met with Qantas Super and that meetings had been “productive”.
“The discussion includes protecting defined benefits; concerns related to when the Qantas Group outsources, sells, or insources functions; and the impact on those employees.” it said.
“No final decisions have been made regarding the future of Qantas Super. However, we would like to reassure all Qantas Super members that the ASU intends to actively engage in discussions with the fund to ensure that your financial interests are protected throughout any potential changes or mergers. Your superannuation is a vital part of your financial future and we are committed to ensuring its stability and security.”