More than half of employers are clueless about super changes
More than half of employers are clueless on what the Your Future, Your Super reforms - including stapling - mean and how to comply, according to new research.
The study, commissioned by consumer experience consultancy CSBA and Fund Executives Association Limited (FEAL) in partnership with Melbourne Business School, surveyed 8355 individual fund members and 1155 employers.
It found 54% of surveyed employers were not aware of the YFYS reform and stapling requirement that comes into effect on November 1.
Among employers who were aware of YFYS, approximately 65% looked to their funds for information and support, including details they could pass on to employees.
The study also found 17% of employers had a specific suggestion for how super funds could improve proactive engagement.
"Any help is better than none. I assumed the stapling was between the employer and the ATO. Anything that will help an employer would be good," one employer was reported as saying.
Another employer gave this feedback: "Some background on what it actually is, and the impact on the employer to be compliant, and anything to give to employees would be fantastic."
When super fund members were asked if they were more or less likely to stay with their fund long term as a result of the stapling reforms, 52% of older members said the legislation would not affect their likelihood to stay compared to 37% for younger members.
Younger fund members, perhaps unsurprisingly, had the lowest agreement with the notion that their fund empowered them for retirement - with 31% disagreeing with the notion entirely.
Contact with a super fund appeared to make a difference in a member's sense of retirement empowerment. For members with recent fund contact, 26% disagreed their fund empowered them to plan and prepare for retirement, compared to 40% for members without recent contact.
Looking at what prompted fund contact in the last 12 months, updating personal details (23%) and obtaining forms and paperwork (22%) were by far the most common reasons for members to contact the funds.
Members closer to retirement were more likely to seek financial advice, discuss insurance and investments and were also more likely to report greater trust with the fund as a result of these interactions.
"In a rapidly moving industry landscape, legislative changes such as YFYS are critical conversation openers for customer engagement. If you haven't proactively contacted your employers or members to explain how YFYS impacts them, it is a missed opportunity to add value and deepen your relationships," says CSBA CX director of finance Sam Monteath.
"Importantly, we know that the younger member cohort, who are likely to be most impacted by 'stapling' within YFYS, typically do not actively engage with their fund, rate their fund lower across key [customer experience] metrics, and are more likely to switch funds in the next 12 months."
This article first appeared on Financial Standard
Get stories like this in our newsletters.
