Superannuation assets in aggregate were $2,324 billion ($2.3 trillion rounded) at the end of the June 2017 quarter, up from the previous quarter which were $2,259 billion, and are now at an all time historical record level. Over the 12 months to June 2017, there was a 10.0 per cent increase in total superannuation assets.
Total assets in MySuper products were $595 billion at the end of the June 2017 quarter, up by 25.5 per cent from a year earlier.
Accrued default amounts fell to zero from $10 billion the quarter before. Funds had until 30 June to transfer any remaining such amounts into MySuper products.
Contributions to funds with more than four members over the June 2017 quarter were $40.8 billion, up 33.4 per cent from $30.6 billion in the June 2016 quarter. Total contributions for the year ending June 2017 were $116.9 billion, up significantly from the previous year ($104.2 billion).
In APRA regulated funds most employer contributions are now superannuation guarantee (SG) or for defined benefit funds, with salary sacrifice only a small proportion of total employer contributions (less than 10 per cent). The reduction in concessional contribution caps taking effect from 1 July 2017 will be likely to reduce this proportion further. However, contributions in the June quarter would have been boosted by individuals taking advantage of then higher caps applying.
Personal contributions in the June quarter 2017 were $16.7 billion, substantially up from $7.2 billion the same quarter a year earlier. It is likely that some individuals are making use of the higher contribution caps applying prior to 1 July 2017.
The APRA-regulated sector average for investment returns was 9.2 per cent over the year to the quarter. This was across all investment options. The five year average annualised ROR to June 2017 was a healthy 9.2 per cent.
As at the end of the June 2017 quarter, 50 per cent of the $1.5 trillion investments in APRA regulated funds was invested in equities; with 23 per cent in Australian listed equities, 23 per cent in international listed equities and 4 per cent in unlisted equities. Fixed income and cash investments accounted for 33 per cent of investments; 21 per cent in fixed income and 12 per cent in cash. Property and infrastructure accounted for 13 per cent of investments and 4 per cent were invested in other assets, including hedge funds and commodities.
Outward benefit transfers exceeded inward benefit transfers by $686 million in the June 2017 quarter. The outflow to self-managed superannuation funds (SMSFs) was $1,396 million in the quarter, down from $1,608 million in the previous quarter. However, this is not large compared to the size of the SMSF sector and is not really driving growth of that sector. The asset share of SMSF continues to be static or showing a slight decline.
There were $22.3 billion in total benefit payments in the June 2017 quarter. Total benefit payments for the year ending June 2017 were $74.5 billion.
The number of APRA funds fell by two to 233 in the June quarter. Fund merger activity amongst major funds has stalled for the time being in terms of completed mergers amongst larger funds. However, a number of mergers are in prospect.