There has been recent discussion in the industry about the benefits of SuperStream. Are the efficiencies envisaged in the Cooper Review able to be realised? What benefits will actually flow to members over time?
However SuperStream plays out, we can be assured that competitive pressures will continue as the industry consolidates, and members develop stronger awareness of the value of their super. One way or another, we have to agree that downward pressure on fees in superannuation will continue.
For lower fees to be sustainable, super funds will need to implement real process improvements to embed efficiencies that will reduce their costs.
SuperStream has the potential to contribute to these efficiencies. The issue today rests on how funds approach the SuperStream reforms. There exists a gulf between simple compliance and fully fledged adoption of the efficiencies SuperStream enables.
What is the real future that SuperStream represents? It could be a large IT investment with little marginal return, because the minimal SuperStream compliance requirements won’t deliver comprehensive efficiencies. Or it could mean happy, loyal employers, customers actively monitoring their contributions and rollovers, small teams of highly specialised administrators troubleshooting exceptions and clear and precise visibility of your operations and your compliance capabilities. All this can be delivered by virtue of automation and straight through processing.
Realistically though, many funds were not in a position to deliver complete automation on day one of SuperStream when rollovers went live on 1 July 2013. And many are still in that position twelve months on, as contributions loom for many funds.
Fortunately, the real benefits of SuperStream can be achieved incrementally, while remaining compliant from day one:
- Stage one – reasonably manual without heavy integration
- Stage two – higher levels of automation in key areas
- Stage three – full automation of all rollovers and contributions
- Stage four – perhaps in-source gateway services and better control costs and service levels.
To achieve this, prepare now to adopt the right technology and business process efficiencies. Plan to move to stages three and four, by being informed and prepared, adopting an incremental approach and finally implementing technology that delivers automated, scalable, agile, and compliant
- Message handling, and
- Reporting – internal & external.
Of course, compliance is an important objective for any superannuation fund. But really, compliance is a means to an end. It’s important not to lose sight of what that end really means: helping members to achieve their financial goals in retirement, by reducing the administrative burden and sending their fees spiralling down.