My GESB Super
Member Outcomes Assessment for 2022/23
This is our annual Member Outcomes Assessment for our default My GESB Super plan for the 2022/23 financial year.
It provides information on how our My GESB Super plan has performed during the year ending 30 June 2023, when measured against the performance of Australian Prudential Regulatory Authority (APRA) MySuper products across the industry. Throughout this assessment, we refer to these APRA peer funds as the ‘MySuper universe’1.
Through this assessment, we aim to demonstrate how we are looking after our members’ financial interests.
Our performance is measured against five key focus areas:
- Investments (including investment strategy, investment returns and levels of risk)
- Fees and costs (including fees and operating costs)
- Options, benefits and facilities
- Scale
- Insurance (including insurance strategy and fees)
Who we are
We are the super fund for the Western Australian (WA) public sector and have over 85 years' experience managing the super savings of current and former public sector employees. With around 247,000 members and over $36 billion in funds under management (as at 30 June 2023), we’re the largest super fund based in WA.
WA public sector super fund
Largest based in WA
85 years' experience
247,000 members
$36b funds under management
Our purpose
To help members achieve a quality retirement
We put our members first in everything we do, which means they can trust us to look after their super. We support them in making informed decisions about their super and we advocate for them when it comes to their super and insurance.
| Our purpose | To help members achieve a quality retirement |
|---|---|
| Our vision | To be the fund of choice for current and former WA public sector employees |
Member profile
Gender
Age
Employment classification
How we've performed - our five key focus areas
1. Investments
Investment returns
Over the 10 years to 30 June 2023, our My GESB Super plan has achieved returns of +6.5% p.a. after tax and investment fees. This was in line with the target return of +6.5% p.a.
Over the short-to-medium term, the performance of our My GESB Super plan is compared with other MySuper products within the MySuper universe1 above.
When looking at the returns for the past one, three, five and 10-year periods up to 30 June 2023, our My GESB Super plan has performed close to the median of other MySuper products.
We are continuously looking for ways to improve our performance against our objectives. Some of the key processes we have put in place to monitor and strengthen our performance include:
- Making additional investments in unlisted infrastructure and private debt
- Enhancing our approach to managing Environmental, Social and Governance (ESG) factors, including implementing lower carbon emission listed share portfolios, and
- Reviewing Strategic Asset Allocations to make sure they remain appropriate
APRA performance test
APRA's performance test judges a fund's past eight-year performance by comparing the fund’s returns to a benchmark selected by APRA that is appropriate for the investment strategy of the fund. If the fund has underperformed the APRA benchmark by more than 0.5% annually (after adjusting for taxes and fees), it is deemed by APRA to have failed.
As an exempt public sector fund, GESB is not regulated by APRA and is therefore not included in the APRA performance test. However, we have assessed our My GESB Super investment plan performance against the APRA-equivalent benchmark and determined that it would have passed the performance test, if we were APRA regulated.
Level of investment risk
Our My GESB Super plan is classified as ‘High risk’ based on APRA’s guidance, which is broadly aligned with the median of other MySuper products available in the MySuper universe. What this means is that, over a 20-year period, it is expected to experience four to six years with negative annual returns.
Maintaining a high risk profile is appropriate for My GESB Super, as the overall goal is to seek higher long term returns. The average age of My GESB Super members is 42, and the average age of new members to the fund is around 34. This means that there is a sufficient length of time for any investment losses to be recovered before most of the money is expected to be drawn down. Therefore, members can generally tolerate a greater degree of shorter term volatility in the pursuit of higher long term returns.
As at 30 June 2023
Investment strategy
The aim of the investment strategy for our My GESB Super plan is to meet our investment objectives. Investments are diversified across a range of different asset classes, to improve the risk-return profile and reduce the impact that any one asset class could have on the overall investment returns.
The investment strategy and objectives are reviewed annually and take into account a range of factors, such as the average age of our My GESB Super members, so that we can ensure that sufficient, but not excessive, risks are taken. The strategy aims to achieve long term returns above inflation and grow the purchasing power of members’ retirement savings.
For more information on our investment strategy, performance and risk visit the My GESB Super plan product dashboard.
2. Fees and costs
Fees
We are well positioned in the MySuper universe when comparing My GESB Super’s total fees, for an account balance of $50,000. We can be found in the lowest fee quartile (as at June 2023)1 in the MySuper universe.
Annual fees and other costs for a member with an account balance of:
$50,000
Representative member fees and costs My GESB Super:
$381
Our fees are made up of a fixed account keeping fee of $66 p.a. ($5.50 per month), plus a variable administration fee of 0.16% p.a. of a member’s monthly account balance. Also included in the total costs shown above are investment fees and costs2, which are not charged as a fee, but are deducted from investment returns before earnings are applied to a member’s account.
We aim to provide our members with products that are fair and equitably priced. We charge fees on a cost recovery basis, which means that fees are set to cover our projected actual costs and our requirements to maintain appropriate reserves. This allows us to continue providing value-for-money products and services to meet our members’ needs.
Operating costs
Our operating expenses, relative to the size of our membership base and assets, are in the lowest quartile and are well below industry medians3.
Our cost per member has remained relatively stable over the past five years, which shows that we are able to deliver superannuation products and services efficiently. Based on a number of assumptions around funds under management and member numbers, our operating cost-to-asset ratio is forecast to remain stable.
Our size allows us to benefit from reduced investment costs. Our management expense ratio, which is the cost to manage our investments, is amongst the lowest of all MySuper products3.
3. Options, benefits and facilities
We provide a range of member information and support services.
These include:
- Insurance claims consultants
- Member Services call centre consultants
- Online Live chat services
- A secure Member Online portal
- One-on-one Retirement Options Service appointments, virtual (online) or in person
We also offer a range of seminars and webinars at no extra cost to our members, to support them in making informed decisions regarding their super, retirement and insurance.
4. Scale
To continue to deliver value-for-money products and services to our members, it is important for us to have adequate scale in terms of funds under management (FuM) and number of members.
Our current membership size of around 247,000 and FuM of over $36 billion allows us to offer our members competitive investment and administration costs, and access to a wide range of products and services, including investment options.
5. Insurance
We provide opt-out default insurance cover for most of our members when they first join GESB. This is to help provide financial support if something was to happen such as serious illness, death or disability. Members can opt out or vary the amount of their insurance cover any time if it doesn’t meet their needs.
Our aim is to provide insurance that members can rely on. Independent analysis of our default insurance offering relative to our member demographics confirms that the default insurance cover we provide for Death, Total and Permanent Disability (TPD) and Salary Continuance Insurance (SCI) is appropriate for our membership4 . We offer default insurance to members who are employed in all occupations in the WA public service (including hazardous occupations). This is not offered by all super funds.
Insurance case study
An example of an insurance change implemented to benefit members is the introduction of insurance transfers5.
As of October 2022, members can apply to transfer Death, TPD and SCI cover from another fund or insurer to GESB . This makes it easier for members to consolidate their super into one account without losing insurance cover and without needing to complete a full insurance application.
For eligibility requirements and transfer terms, refer to the Insurance transfer form.
Insurance fees
Our objective is to provide appropriate default insurance cover that does not inappropriately erode our members’ super balances.
We aim to minimise cross-subsidisation and on average default insurance typically costs less than 1% of lifetime earnings for most of our insured members. This can rise to 1.5% of lifetime earnings, recognising the impact of occupational loadings.
We keep members informed of the insurance premiums they pay. This enables them to make decisions about their insurance, such as maintaining their insurance to meet their specific circumstances, reducing their sum insured, opting out of cover, or (for SCI) reducing the length of their Waiting Period.
Board declaration
The GESB Board has determined that GESB is promoting the financial interests of the beneficiaries of the fund.
Jo Gaines - Chair
Ben Palmer - Chief Executive Officer
Footnotes:
1 APRA quarterly Superannuation Product Statistics, June 2023.
2 APRA quarterly MySuper Statistics table 4a, June 2023. Investment fees and costs include amounts that have reduced or will reduce the return on members’ GESB Super interest, that are paid from or reduce the amount or value of the investments in the chosen investment plan (including those investments held through an investment vehicle). These include all investment and transaction costs related to managing the investments in the chosen investment plan. These are not charged to members as a fee but are deducted from investment returns before earnings are applied to their account.
3 SuperRatings Annual Benchmarking Report 2024.
4 WTW Government Employees Superannuation Board, Insurance Product Design and Market Sounding Report.
5 Insurance changes notification: GESB Super and West State Super, October 2022.
Thank you for printing this page. Remember to come back to gesb.wa.gov.au for the latest information as our content is updated regularly. This information is correct as at 26 April 2024.