Improvements in financial planning services and insurance benefits mean members from both funds will win out in the recently confirmed merger between Queensland-based energy industry super funds ESI Super and SPEC Super.
The merger is effective from 1 April, with the $3.6 billion merged fund to be called Energy Super. It will adopt a best of both worlds approach from the two existing funds, according to Bob Henricks, current chairman of both ESI and SPEC Super.
Both funds currently use AIP for income protection but members of the two funds will benefit from an increased membership base, which means a better platform for negotiations, Henricks said. The general insurer has yet to be confirmed but Henricks anticipated members would also be in a better position following the merger due to an improved platform for negotiations.
SPEC Super members are already taking up the in-house financial planning offering currently employed by ESI Super, which Henricks said is working far better than SPEC's previous outsourcing arrangement.
Through the fund's financial planning service it is also offering additional member education services, including online modules around topics such as the basics of investing, which is getting high recognition and usage from members, Henricks said.
Making members more knowledgeable and easily able to compare apples with apples when comparing super funds makes them more loyal, and they respond well when they understand the services they're getting, he said.
Energy Super has also adopted ESI Super's in-sourced call centre model, leading to a greater sense of ownership of the fund among members, Henricks said.
SPEC Super's streamlined administration model with IFAA will be retained for the merged fund, while JANA will continue on as the investment consultant having already established a relationship with each fund individually.
Leading up to the merger there was a proactive program of manager consolidation to position the investments of the funds so that the merger could come together more easily, Henricks said.
The merged 45,000-member fund would allow for shared service cost savings, greater cash flow, access to more investment opportunities at a lower cost, and opportunities for enhanced member services and benefits through its increased scale, Henricks said.
