Concept One and WA Super Merger

Concept One logoConcept One and WA Super Merger

Perth based superannuation funds, Concept One and WA Super will merge in 2018. The deal will involve Concept One members being transferred into WA Super, building the scale and efficiency of the only Western Australian based, not for profit, public offer super fund.

If you have any questions about this merger, please read the FAQs below and the Media Release available here. For further information contact Concept One on 1300 720 182. 

Frequently asked questions

Why is Concept One merging with WA Super?

In the last 10 years, there have been significant changes within the super industry, which has made it challenging for funds like Concept One to continue to deliver member benefits cost-effectively. This was one of the reasons Concept One began a review process in 2016 to identify opportunities that would serve its members best interests.

From January 2018, Concept One will merge with WA Super. The deal will involve Concept One members being transferred into WA Super, building the scale and efficiency of the only Western Australian based, not for profit, public offer super fund.

Any merger must be in the membership’s best interest and overall, the level of services and benefits must be maintained or are better than the existing arrangement on offer from Concept One. Due to WA Super’s superior economies of scale, access to their financial advisory services and the ability to continue to service members and employers locally, this merger offers a number of enhancements to Concept One member’s existing benefits and will be in their best interest.

Who is affected by the change?

The change will affect all Concept One members and employers and will not impact WA Super members.

How will Concept One members benefit from this transfer?

  • Lower fees due to a competitive and simple fee structure with WA Super.
  • A menu of 9 investment options.
  • Seamless continuation of your existing insurance arrangements, with a reduction in insurance premiums for members.
  • Access to a range of tools and educational resources to help you manage your super.
  • Access to financial planning advice so you can stay on track with your retirement planning.
  • Personalised and professional service from our dedicated contact centre and account managers.
  • Face to face employee programs.

How does this proposed merger benefit WA Super members?

This is a positive move for all WA Super members. To stay competitive in the ever-changing superannuation environment, we are always looking to identify ways that WA Super can grow and expand. Growing our member numbers and ultimately our funds under management helps WA Super to benefit from economies of scale.

This is important because greater scale enables us to achieve efficiencies that can lead to lower operational costs per member. This translates to higher net returns over the long term and means our fees also remain highly competitive. Greater scale also facilitates the introduction of new and improved services. In fact, an exciting service will be available to all members in the near future that will help you (at no cost) to reach your retirement goal.

When will  Concept One members get more detailed information about what this means for them?

Concept One will be writing to it's employers and individual members shortly providing details of this merger, including an overview of the member benefits and specific timing.

When will the merger occur?

Implementation of the merger is expected to occur in early 2018. Talks between the two Western Australian based funds commenced in December 2016 with the signing of the agreement occurring on Tuesday 26 September 2017.

What is a Successor Fund Transfer?

Successor Fund Transfers (SFT) are regulated under the Superannuation Industry Supervision Act 1993 and the Superannuation Industry Regulations 1994. It involves the transfer of members and their benefits from one fund to another fund.

With any successor fund transfer, it is the Trustees’ responsibility to ensure members have equivalent rights. This means any merger must be in the membership’s best interest and overall, the level of services and benefits must be maintained or are better than the existing arrangement on offer from Concept One. Due to WA Super’s superior economies of scale, access to their financial advisory services and the ability to continue to service members and employers locally, this merger offers a number of enhancements to Concept One member’s existing benefits and will be in their best interest.

Why was this decision made?

The ongoing rationalisation and legislative changes within the superannuation industry over the past 10 years has proved challenging for smaller funds; particularly with maintaining low fees and providing associated member services.

Therefore to continue providing the best possible retirement outcomes for their members, Concept One began to explore options to maintain its high standards of operational effectiveness and efficiency, without compromising member services, servicing and entitlements.

Will fees increase for Concept One members? 

No. They will actually decrease. WA Super fees are lower than Concept One fees.

Example – default option (MySuper) with a balance of $50k

Concept One

WA Super

Investment fee

$375pa (0.75%)

$260pa (0.52%)

Administration fee ($ p.a) 

$91pa ($1.75 pw)

$72.80pa ($1.40 pw)

Administration fee (% of account balance p.a)

$100pa (0.2%)

$40pa (0.08%)

Indirect Costs

$195pa (0.39%)

$240pa (0.48%)

Total per annum

$761.00

$612.80

Will Concept One members incur any costs in this merger?

No direct costs for this transfer have been charged to members. Estimated costs for these types of transfers are paid from a reserve that has been set aside expressly for this purpose.

Who was involved in making this decision?

The Trustee of Concept One undertook a review of options available in the marketplace, with the assistance of an independent consultant specialising in corporate superannuation funds. After investigating current arrangements, the Trustee resolved to proceed with a merger with WA Super.

When will the transfer to the new fund arrangement occur?

The transfer date is anticipated to be 26 January 2018 at which point member's account balance in Concept One will be transferred to WA Super and invested in options comparable to those offered in Concept One.

Why was WA Super selected?

WA Super has its origins in looking after Local Government and Western Australian employers. It now receives contributions from over 4,000 employers and has grown steadily over the last 35 years, managing over $2.8bn of retirement money on behalf of its members.

The synergies between both funds are numerous and complementary, including values of respect, transparency and high quality, personal servicing, similar investment options and WA based headquarters.

The combined entity will manage over $3.2 billion on behalf of 60,000 members.

Both Trustee Boards are delighted about the prospect of a merger between two Western Australian super funds. The signing of the SFT Deed is the culmination of many months of due diligence by both funds and from independent external advice.

Do Concept One members have to do anything now?

No. Once the merger proceeds, the transfer will happen automatically on 26 January 2018. Concept One members can also be confident that their accrued benefits won’t be affected due to the transition to WA Super. During this time, Concept One remain fully committed to ensuring the transition is as simple and seamless as possible.

What will happen to insurance cover held?

Insurance cover held by Concept One members will be transferred to WA Super at the same level of cover they held as at the transfer date. Most members will pay less for their insurance. Details will be provided shortly in a significant event notice to all Concept One members.

What process has been followed with the merger review?

The decision to merge involved a rigorous due diligence process, which commenced in December 2016 and is scheduled for completion by 30 November 2017. To ensure the best outcome for members, Concept One developed specific assessment criteria and engaged a range of independent superannuation specialists to help with the review.

In addition, there are stringent requirements under the legislation for merger processes, which is meticulously supervised by APRA, the regulatory body for super funds. As part of this legislation, a member’s overall package must either be equivalent to or better than the current arrangements offered by Concept One.

After much analysis, research and consideration, Concept One believe the merger with WA Super will be the right move for their members going forward.

What will happen to the investment returns for Concept One members?

The Trustee Boards of Concept One and WA Super have agreed to merge on the basis they believe it will be in the best long term interests of both Funds’ members including the returns on the various investment options going forward.

What is WA Super’s investment approach?

WA Super has sufficient scale to manage it's members’ retirement savings with a robust, institutional quality investment process. This is supported by a capable and experienced Trustee Board and Investment Committee. WA Super’s investment approach is clearly articulated in a set of investment beliefs and principles that guide all investment decision making at WA Super.  WA Super’s investment approach is to build portfolios that are:

  • Simple
  • Diversified
  • Objectives based
  • Prioritise downside protection
  • Reasonable cost

Will the name of Concept One's investment options change following the transfer WA Super?

For members whose balance is transferred to WA Super, they will be invested in a comparable investment portfolio. The table below displays the name of the comparable WA Super investment option.

Concept One

 

WA Super

Assertive

Diversified High Growth

MySuper Balanced

MyWASuper

Conservative

Diversified conservative

Cash

Cash

Are there any other investment options available at WA Super? 

Yes, at WA Super members can take control of their super and manage their fund investment the way they want to by choosing how their super is invested.

WA Super offer a total of nine different investment options to choose from. If Concept One members decide not to make a choice then their investment will be placed into a comparable investment option as outlined above.

Investment options - Super Solutions

Investment options - Retirement Solutions

My WA Super (default option for Super Solutions product)

Diversified High Growth

Diversified High Growth

Diversified Moderate (default option for Retirement Solutions product)

Diversified Conservative

Diversified Conservative

Australian Shares

Australian Shares

Global Shares

Global Shares

Sustainable Future

Sustainable Future

Property and Infrastructure

Property and Infrastructure

Bonds

Bonds

Cash

Cash

How does WA Super manage its investment operations?

An internal investment team is employed by WA Super to manage the day-to-day investment operations. The team assist the Investment Committee (IC) and Trustee in making appropriate decisions that are consistent with the Trustee’s Investment Beliefs and Principles and that are in the best interest of our members.

The investment team also work closely with an Asset Consultant and various professional external investment managers to gain expertise and advice and ensure we effectively manage our investments.

Who do I contact if I have questions? 

If you have any questions about the merger, you can email admin@conceptonesuper.com.au or call 1300 720 182.