The Australian Prudential Regulation Authority (APRA) has released statistics on trends in superannuation in Australia over the ten years from June 1996 to June 2006.
The special edition of APRA’s Insight publication, Celebrating 10 years of superannuation data collection 1996-2006, includes general statistics on assets, accounts and contributions, as well as data focusing on the manner of investment, return on assets, investment choice and asset allocation of the default investment strategy.
Deputy Chairman Ross Jones said the ten years of data had been published to create an authoritative reference for the superannuation industry and for the general public.
“Over this ten years, the superannuation sector has experienced major change and expanded into a professionally managed industry that now wields significant investment might and global reach.”
“We expect this publication will not only assist those in the industry but also the broader community in making decisions about their superannuation,” Mr Jones said.
Total superannuation assets in Australia over the ten year period grew at an annual average rate of 14.3 per cent, and almost quadrupled from $245.3 billion in June 1996 to $912.0 billion in June 2006. This growth has increased superannuation assets as a proportion of Gross Domestic Product (GDP) from under 40 per cent in 1996 to nearly 100 per cent in 2006.
Small funds and industry funds experienced some of the strongest asset growth over the past decade, at rates of 22.7 per cent and 22.5 per cent, respectively. Retail funds (excluding eligible rollover funds - ERFs) grew by 17.5 per cent, public sector funds by 12.8 per cent and corporate funds by 2.2 per cent.
The publication shows that contributions grew an average of 12.0 per cent annually over the past ten years, with member and employer contributions growing 14.2 per cent and 11.4 per cent per year, respectively. Benefit payments grew on average by 7.9 per cent annually with pensions and lump sum benefit payments growing by 13.3 per cent and 6.5 per cent per year, respectively.
A significant change over the ten year period was the consolidation in the number of larger APRA-regulated superannuation funds. These numbers fell from just under 5,000 funds to just under 1,000, which are in turn overseen by just over 300 APRA-licensed trustees.
“The combination of smaller fund numbers and substantial asset growth has meant that, over the past ten years, the average APRA-regulated fund has increased from around $40 million to around $800 million. This consolidation of funds has led to a much stronger and secure regulated superannuation sector.” Mr Jones said.
The publication also shows that, from 1996 to 2006, the average return on assets (ROA) for superannuation entities with at least $100 million was 6.7 per cent. Public sector funds had an average ROA of 8.0 per cent, followed by corporate funds with 7.8 per cent, industry funds with 6.7 per cent, ERFs with 5.4 per cent and retail funds (excluding ERFs) with 5.3 per cent.
Other figures show that those entities with assets of at least $1 billion achieved the highest ROA of 6.8 per cent over the ten years from 1996 to 2006. This was followed by entities with assets of under $100 million with 6.4 per cent (though the population is very small and consists largely of corporate funds), entities with assets of between $100 million and $500 million and entities with assets of between $500 million and $1 billion, both with 6.3 per cent.
Accounts with an average balance of at least $100,000 achieved the highest ROA of 7.7 per cent over the ten years from 1996 to 2006. This was followed by accounts with an average balance of between $25,000 and $100,000 (7.3 per cent), between $10,000 and $25,000 (5.7 per cent), between $5,000 and $10,000 (5.4 per cent) and under $5,000 (4.4 per cent).
The information in the publication was compiled from data from APRA, the Australian Bureau of Statistics (ABS) and the Australian Tax Office (ATO).
The publication is available on APRA’s website at http://www.apra.gov.au/Insight/.
The Australian Prudential Regulation Authority (APRA) is the prudential regulator of the financial services industry. It oversees banks, credit unions, building societies, general insurance and reinsurance companies, life insurance, friendly societies, and most members of the superannuation industry. APRA is funded largely by the industries that it supervises. It was established on 1 July 1998. APRA currently supervises institutions holding approximately $2.5 trillion in assets for 20 million Australian depositors, policyholders and superannuation fund members.
Media and industry inquiries only:
Andrew McCutcheon, Public Affairs Manager
Australian Prudential Regulation Authority
Telephone: 02 9210 3143
Mobile: 0417 528 660
All other inquiries:
APRA Contact Centre 1300 131 060
