Leading Queensland local government fund LGsuper has selected Decimal to help drive a technology-based solution in support of fund members requiring single-issue financial advice.
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With the merger of LGsuper and City Super due to officially begin on 1 July, 2011, the fund is targeting an increased need for limited advice services to members. LGsuper currently manages around $4.4 billion in funds on behalf of 75,000 members. City Super has approximately 13,000 members and $1.5 billion in FUM.

David Todd, LGsuper CEO said: “In choosing Decimal we have a technology partner that will deliver end-to-end functionality and help our fund address a number of specific business and technical requirements. These include the ability to scale-up in future. We also anticipate deeper engagement by our fund members via the phone and face to face advice which will of course be underpinned by the Decimal technology.”
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Plans are in play for LGsuper to also adopt Decimal’s innovative SmartCalculator in the near future. The integrated online calculator represents a best of breed compliance, engagement and financial forecasting tool, with focus on the member and adviser at all times.
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Decimal Managing Director Jan Kolbusz said he was pleased to have been chosen by LGsuper to help empower its members with an elegant, simple advice solution. “We appreciate the high standards set by LGsuper and its board for service and technology requirements,” Mr Kolbusz said.
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The appointment of Decimal by LGsuper follows a number of similar organsiations signing on with Decimal. Recent partnerships include superannuation fund administrator Pillar Administration, and leading corporate fund AvSuper, based in Canberra.
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Meanwhile, representatives of the major Melbourne-based industry funds will be hosted by Decimal and leading consulting firm KPMG next week, June 15, for a breakfast presentation called “FOFA so good?: The role of technology in navigating change”.
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Matt O’Keefe, KPMG IT Advisory Partner, will discuss the role of technology for super funds riding the wave of regulatory and consumer behavioural change. Technology will play a crucial role in all aspects of member support including member retention, communication, engagement, literacy and advice.

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Bozenna Hinton, Institute President, said the Institute supports the concept of an identifiable risk reserve for superannuation funds held separately from member account balances. She said the minimum level for this should be set on a risk assessed basis consistent with other financial services industries.

“We are pleased that the Government will consider a risk based system for all APRA regulated super funds requiring them to hold financial resources against operational risk, as we recommended this in our submissions to the Cooper Review,” Ms Hinton said. “We note that the Government will consult with relevant stakeholders on whether such a system should require resources to be held in the form of trustee capital or an operational risk reserve in the fund.”

The Institute confirms that as part of this process, a Financial Condition Report for accumulation super funds should eventually become compulsory, but in the meantime should be considered best practice. Such a report would allow trustees to stress test a super fund under different market conditions.

Support for idea that super funds consider longevity risk but more work needed The Institute also supports the recommendation that both MySuper and choice super funds be explicitly required to consider longevity and inflation risk. However, Ms Hinton said more concrete measures were needed.

“As a next step, we encourage the Government to remove the roadblocks preventing innovation and product development in the post retirement product market including social security and tax barriers.

Development of new post retirement products will better equip Australians to protect themselves against their own longevity risk,” Ms Hinton said.

The Government has also indicated that while it does not support mandatory retirement forecasts for MySuper products, it will ask the Australian Securities and Investments Commission to continue working on developments in this area.

“The Institute strongly supports the idea of retirement forecasts being provided to super fund members so is disappointed about this outcome. However, we look forward to working with ASIC particularly in relation to the assumptions used for such forecasts and how the results could be presented,” Ms Hinton said.

“Similarly, we look forward to working with APRA and ASIC regarding the publication of superannuation data designed to improve transparency and comparability in relation to net investment performance fees and costs,” Ms Hinton said.

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