Mercer Super Trust has made a number of fee changes to its funds, including a 38% reduction to its headline MySuper asset-based administration fee.
Mercer said the reductions, along with being able to simplify products and processes and adding stronger sustainable investment products, were due to continued growth along with greater operational efficiencies.
Mercer Super Trust head, Mark Thompson, said: “Our greater scale and efficiencies achieved through the growth of our business has allowed us to pass on savings and benefits to our members without compromising the services we are delivering.
“While from an operational perspective it makes sense for us to simplify our product suite and create greater consistency across our products, it all boils down to our focus on improving the retirement outcomes of members.”
Mercer’s announcement said other changes included:
- Restructuring of the lifecycle investment product Mercer SmartPath® by adding more growth asset exposure for older members, changes to improve retirement outcomes for members of all ages, and a simplification of the fee structure that applies across cohorts;
- Reduction in investment fees for the majority of members;
- Consistency of fee structure for members across employment and retirement; and
- Simplification of environmental, social, and governance products and greater visibility of ‘Sustainable Plus’ products, which are subject to an even wider and more stringent set of ethical and sustainable criteria than Mercer SmartPath®.
Effective 1 April, 2021, Mercer Super Trust changes included:
- Reduction to headline (maximum) asset-based administration fee of 38%, i.e. from 0.55% to 0.34% for MySuper default members in Mercer SmartPath®;
- Reduction to headline (maximum) asset-based administration fee of 35%, i.e. from 0.60% to 0.39 per cent for choice members;
- For members of Mercer SmartPath® born before 1964, an increase in growth allocation assets from 50% to 60%, changing the asset mix within each cohort. Investment fees for these members will be increasing slightly (from 0.33% to 0.38%). There will also be a delay to the start of the reduction to growth exposure from age 47 to 52;
- For members of Mercer SmartPath® born after 1963, we are reducing investment fees from 0.47% to 0.44%;
- Closure of Mercer Growth for choice members, with existing members having the option to choose another product (Mercer Select Growth by default); and
- A temporary expense allowance increase of 0.03% for three months to respond to the significant increase in regulatory change, and investments in member services.