The state government's $8.8 billion superannuation fund will for the first time face compettion following the introduction of legislation that also allows the fund to compete for members outside the public sector.
The state government's $8.8 billion superannuation fund will for the first time face competition following the introduction of legislation that also allows the fund to compete for members outside the public sector.
GESB, formerly the Government Employees Superannuation Board, will the biggest superannuation fund based in Perth, ahead of industry fund Westscheme.
With around 280,000 members and around $8.8 billion under management, GESB had previously been exclusively for the use of state government employees.
The legislation introduced today will give state government employees the right to choose their superannuation fund, bringing them in line with national reforms introduced in recent years.
GESB is chaired by former Alinta chief Phil Harvey, and has former banking executive Michele Dolin as its CEO.
The full text of a Ministerial announcement is pasted below
Western Australian public sector employees will be able to choose their superannuation fund under legislation introduced to State Parliament this week.
Government Enterprises Minister Ljiljanna Ravlich said the changes would bring the right of State Government workers to choose their superannuation fund in-line with national trends and most Australian employees.
"Currently, members who have left the public service are not able to keep contributing their employer contributions to GESB," Ms Ravlich said
"Under this legislation, they will be able to choose to stay with GESB and continue to take advantage of its sound investment returns and low fees.
GESB is WA's largest superannuation fund, with around 280,000 members and more than $8 billion under management.
"Research and consultation has shown that members think it is important to be able to choose the super fund that best suits their requirements," the Minister said.
"In an environment where choice of superannuation fund is now standard practice, we think it is important that they are able to do so.
"In addition, the changes would allow GESB to become a public offer fund so that members could continue to contribute their employer contributions to GESB after they leave the public sector and family and friends can also become members."
Ms Ravlich said a new member-owned organisation GESB Mutual would be created to oversee the accumulation scheme funds under Commonwealth regulation, in line with superannuation and wealth management industry standards.
The State would continue to manage and regulate the defined benefit schemes and while the schemes would be regulated by different authorities, GESB Mutual will continue to be the single point of contact for all members.
"GESB is now operating in a rapidly changing regulatory environment and it is appropriate that it moves to regulation under the Australian Prudential Regulation Authority and the Australian Securities and Investments Commission," she said.
"This is also in line with recommendations made by the Auditor General in 2004.
"Under this structure, all value will remain with members, with any surplus being returned to members through maintaining competitive fees and delivering new products and services."
Ms Ravlich said the reforms would provide WA public service workers with the opportunity to make their own choices about their superannuation.
"Superannuation is one of the biggest investments working Australians will make," she said.
"These changes will provide WA public sector employees, their families and friends with the opportunity to take more control of their superannuation and financial future."
