The ASIC report into death benefit claims revealing the devastating impact of poor industry practices on grieving Australians has again highlighted the pressing need for change. While some funds have taken up the cudgels, others are still playing hardball on improving their service offering.
A Retirement Income Covenant obligation notwithstanding, there is still a paucity of these complex products on offer. The Advice Through Superannuation draft legislation might offer a way forward.
NAB okay but other partners to go in Prime/HIP merger
(Pictured: Ross Bernays)
The proposed merger between Health Industry Plan and Prime Super, which has been under discussion for at least three months, will result in a more sustainable and competitive fund of $2.4 billion and 150,000 members.
Under the announcement last week, HIP members will transfer under the ‘successor fund transfer’ on May 1, which will set a cracking pace for all involved. Investor Strategy News first referred to the merger discussions last September.
The HIP brand will remain, at least for a while, following the example set by First State Super when it merged with Health Super. Both mergers demonstrate that the industries covered by pre-merger funds do not matter as much as membership profiles, union and industry association affiliations and so forth.
Prime’s chief executive, Lachlan Baird, becomes the new chief executive and HIP’s chief executive, Ross Bernays, becomes the new chief investment officer. Both funds have run lean staffing, with Prime’s John Deininger, for instance, doubling as finance and investment manager.
But there will be at least two losers among the asset consultants and member administrators, the services for both of which are likely to be put out for tender. NAB Asset Servicing, however, is the custodian for both funds, which should streamline the transfer of assets. NAB was re-signed by Prime for five years starting last year.
Prime uses Access Capital as asset consultant, while HIP uses JANA. If Access loses the new mandate it will have only one major super fund client left, MTAA Super.
On the administration side, Prime uses Link (AAS) and HIP uses SuperPartners.
Bernays said: “Merging with Prime Super will ensure all members and employers benefit from greater economies of scale, with the aim of delivering improvements to the financial wellbeing of every one of our members.”
