Despite being a growing reservoir of funds under management, this critically important pool of capital is confronting mounting problems collating and disseminating key data in a timely manner.
The ratings house is pinning its growth strategy on a revamped methodology that increases the emphasis on governance to 25 per cent – a timely move considering APRA’s proposed reforms.
Inconvenient glitch in Fin Synergy/Pillar admin project
(pictured: Michael Dwyer)
The two companies are for sale – one by the NSW Government and the other by its founder. They are engaged in a big tech-heavy project for a high-profile super fund. But the project has not gone to plan. Oh no, not again.
The $55 billion First State Super has been advising members through its website since September 2 that there are several problems for those who have been looking to access their online account information.
These problems include: delayed and incorrect unit price information; delays on switches and other requests; delays in benefits and pension payments; incorrect display of insurance cover; inability to link accounts for those with multiple accounts; incorrect display of defined benefit account information; incorrect production of Centrelink schedules; and, difficulties resetting PINs or gaining access.
In sum: an administrative, but probably only short-term, nightmare for the administrator, Pillar Administration, and its major systems provider, Financial Synergy, both of which are for sale.
First State Super advised its members as of last week: “We are resolving these issues quickly as possible.” You could put a lot of money on Pillar and Financial Synergy doing their utmost to resolve them very quickly, especially under the circumstances.
For the superannuation industry, the déjà vu element of all this concerns the lengthy and expensive troubles that the former Super Partners had with its systems re-build which led to the eventual sale of the industry fund-owned administrator to competitor Link Group. Now, two years later, Link is considered the front-runner to buy Pillar, assuming it is allowed to do so by the Australian Competition and Consumer Commission.
Meanwhile, Financial Synergy was put on the market by founder David Orford a few months ago, with an asking price of more than $100 million, after a very good period for its business in which it upgraded its contract with Pillar and added a big new one in the Statewide super fund of South Australia. Talk is that four systems companies have expressed interest.
According to a report in the weekend edition of the Australian Financial Review, Michael Dwyer, First State Super’s chief executive, said the member information had not been compromised in the glitch; just access to it. The newspaper report said, also, that the fund was the only one of Pillar’s clients which had been affected by the problem.
