Employer super contributions peak as new SG level kicks in
Record levels of employer contributions into employee superannuation accounts will push asset managers to improve their processes to deal with the increasing levels of money flowing into superannuation.
A record $15.57 billion was paid by employers into employee super accounts in the third quarter of this year, the first in which the new 9.25 per cent Superannuation Guarantee level was levied.
Gross domestic product (GDP) data released by the Australian Bureau of Statistics (ABS) show that superannuation contributions rose by 1.2 per cent during the September quarter, up from $15.38 billion in the second quarter of this year, and were up 4.8 per cent from $14.88 billion this time last year.
The growth in employee super contributions occurred while national productivity, as measured by GDP per hour worked in seasonally adjusted terms, did not grow during the third quarter and was up only 0.9 per cent from a year earlier, according to the ABS data.
DST Bluedoor executive director Martin Spedding said the increase in super savings would drive asset managers to be more efficient and spend more on technology as they kept abreast of regulatory changes and productivity gains.
"The nation's superannuation savings pool is rapidly rising in value, and we can expect it to reach $2 trillion in 2014, from $1.75 billion in the September quarter this year, driven by growing compulsory superannuation contributions and rising asset values. This is forcing superannuation funds, wealth managers and administrators to upgrade their technology solutions to seek efficiencies and automate manual processes," Spedding said.
"Over the past year, we've seen a rise in technology spend by superannuation funds and other financial service organisations and we expect this trend to continue.
"Greater regulation of the superannuation sector through SuperStream regulation and APRA [the Australian Prudential Regulation Authority] data reporting is only adding to the pressure on superannuation funds to upgrade their technology systems and become more efficient."
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