St Georgebank has taken some unusual steps in the outsourcing of its $250 million super fund. While it will roll the fund into the Plum master trust before year end, staff could, instead, opt for its own master trust product, ASGARD, and from next year, they will have full choice-of-fund.
The fund’s manager of superannuation, Kim Purvis, says St George invited only two master trust providers — Plum and Mercer — to tender for the contract. This followed a review of the market last year and took into account already existing relationships. Mercer is the fund’s administrator while MLC, Plum’s parent, is the fund’s implemented consultant.
Package staff, however, were also given the choice of transferring voluntarily into ASGARD, the master trust within the St George bank stable, because “we offer such a good product in-house”. And 500 staff members, with a combined $50 million in super assets, have taken up this option.
Purvis says ASGARD was not considered as a service provider for the entire fund because it usually deals with corporate funds with assets of under $50 million and doesn’t handle defined benefit plans.
She adds that the St George’s board’s would prefer wider choice-of-fund and a recent employee survey found that members would to. As a result, from next year onwards, staff will be able to place their super wherever they want, providing that the group’s administration system can handle their selection.
“I wouldn’t expect more than 5-10 per cent of staff to do this, but at least there’s a choice,” says Purvis. But she cautions that some staff may not be able to take this up until 2005 because of existing enterprise agreements.
Purvis, who joined St.George Bank in January 2000, will remain with the fund on a part-time basis until the transition is completed, afterwards she will consider her options within the group or within the super industry.
