MySuper: Two years in, how is MySuper performing?FSC Annual Conference: VisualiseJim MinifieProgram Direcor, Pro!uci"iy #rowh$ Augus %&'(2MySuper was inro!uce! o simplify !efauls, promoe compara)iliy an! re!uce cos Super choice made comparability critical MySuper was part of a broader set of reforms aimed at cutting costsMySuper an! )roa!er recen reforms may cu coss '&* per cen MySuper will cut about ~10 bps from average default fees all driven by retail funds Potential for larger reductions from FoF and SuperStream mostly outside MySuper+"en afer reforms fully )e! in, e,cess a!minisraion cos will remain verage MySuper admin fees per person are close to double what they should be Fund and account consolidation are ma!or opportunities "ap to the administration frontier #~$12% per person& is $%00m in MySuperThere is also e"i!ence of e,cess in"esmen cos - har!ly ouche! )y recen reforms 'igher(cost products tend to underperform in ma!or asset classes "ap to the frontier #of ~)%bps& is $*00m in MySuper Policy can accelerae he remo"al of remaining e,cess coss Splitting defaults from awards may not reduce and could even increase costs and fees +emoving 12 million e,cess accounts would save $-.0m #$-00m in MySuper& Fund mergers would save $%00m #$200m in MySuper& /ougher MySuper 0ualification #eg tender& would cut administration and investment costsSummary-01020-0)0Public sectorIndustryCorporateRetailFees #1& on $%02000 balanceCone,: )roa! sprea! of superannuaion fees3ist fees2 per cent of funds under management4ote5 Fees recorded for public sector and some corporate funds may not include all relevant costs as some are paid by the employer6 7,cludes some smaller products offering a broad range of investment options6 7,cludes self(managed superannuation funds6 Source5 "rattan analysis of Super+atings #201)& #fee& and 8+ #201)a& #F9M& data6 For the past decade fees have remained highly differentiated6 :ndustry fund fees have risen slightly; fees on simpler retail products have fallen slightly2 and fees on other retail products have risen6 )+,penses in %&&.+,penses in %&'/Cone,: he cos cur"e shife! up7,penses2 per cent of funds under management Sources5 8+ #201)&2 Super+atings #201)&Fund siPropose! program coul! sa"e anoher '& per cenFees and potential savings2 8+ reg6 funds2 todayJs system scale2 $ billion%6>)6??6**.6*226-.16..062*061.1.6213.016 SuperStream26 FoF-6 MySuper16 Fund consolidation26 Aefault tender-6 ccount consolidationSource5 "rattan analysisA!"ice0n"esmenA!minisraion20>6>-6-06216)06?06.106>%624otes5 =ollective funds only #e,cludes SMSFs&6 Modelling assumes that cost reductions are directly passed on as fee reductions6 Source5 "rattan nalysisThere are opporuniies in !efaul an! choice superFees and potential savings2 $ billion Sa"ings from curren iniiai"esSa"ings from propose! iniiai"es1emaining fees21:ac; up: mergers coul! cu coss )y one8si,h dmin cost reduction from merging two average si