Western Super Fund (WSF) is a privately run, not-for-profit WA-based superannuation fund set up 25 years ago to serve Local Government employees. WSF’s original objective was to infiltrate the Local Government sector with the promise of helping that sector’s employees achieve retirement security. This strategy enjoyed success as WSF became the default superannuation fund for almost all WA-based local government authorities.
About 10 years ago, it became apparent that WSF was losing an unacceptably high number of members as they reached retirement. The problem was simple; WSF had just the one product - a superannuation accumulation account, i.e. an opportunistically sidestepped this option. Therefore, the aforementioned revenue targets were set much higher than was needed as they did not take into account the continuing stream of product fee revenue. Furthermore, unlike other Financial Planning business models, the target made no allowance for the considerable revenue generated from the $0.5 billion of pension FUM the FP team had already amassed.
There was a sense amongst the staff that the decisions made had little to do with realistic or rational commercial thinking but were rather the unrefined methods of a small band of self-interested managers desperately trying to build as thick a layer of insulation as possible receptacle for each member’s superannuation contributions. WSF had not designed a retirement or pension product so it was a necessity for