Industry forecasters are predicting that Australia’s superannuation sector will experience significant growth in the 2014/15 financial year, with revenue expected to reach $14 billion.
The IBISWorld forecasts industries to rise and fall in the next financial year report, revealed super funds would continue to benefit from a large pool of accumulated savings in the system, IBISWorld general manager.
IBISWorld general manager, Daniel Ruthven predicted that the industry would experience revenue growth of 10.5 per cent in the next 12 months, with more than $800 billion in funds under management.
“Our expansive superannuation system is delivering strong returns for both investors and the funds themselves,” he said.
“Compulsory contributions increased at the beginning of 2013/14, further driving the amount poured into superannuation.
“This has been coupled with strong returns in the financial markets over the past five years, bolstering consumer sentiment and allowing for some increase in the demand for investment options carrying greater risk.”
The report also forecast strong growth in the mortgage sector with revenue set to top $80 billion, driven by favourable lending conditions, declining interest rates and government assistance packages aimed at boosting demand for property.
Australia’s second-largest super fund has confirmed it is expanding its presence in the UK following significant investment in the region.
A member of the super fund has approached ASIC to investigate potentially misleading or deceptive representations by UniSuper regarding the holdings of its sustainable portfolios.
The median growth fund delivered 1.9 per cent in March, adding to the “stunning” rally that has seen super funds gain 11 per cent since November.
Vanguard has affirmed its support for the current super performance test, emphasising the importance of keeping the process straightforward.
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