Australia's superannuation industry manages $2.0 trillion making it 30% larger than Australia's GDP at June 2016 and among the largest superannuation savings pools in the world. To help students, researchers and interested observers better understand the role superannuation plays in the Australian economy SelectingSuper and its research partner Rainmaker Information has compiled some figures that we believe will help people grasp how big the industry is.
Australia's superannuation system at end June 2016 had $2.0 trillion in assets, representing about $167,000 per member or about $71,000 per account noting that many Australians are members of more than one fund.
Australia's superannuation savings pool is already 130% the size of the Australian economy as represented by GDP which at end June 2016 was an estimated $1.5 trillion.
At current growth rates that sees the superannuation savings pool grow in most years by 8-10% pa compared to GDP which grows most years by 2-3% pa, by 2036 it is reasonable to expect Australia to have accumulated $8 trillion in superannuation savings which by then will be more than twice the size of Australia's $3 trillion economy.
This massive amount of money being available for investment means Australia's superannuation system is one the nation's most important economic achievements and one of Australia's best international comparative advantages.
But with this massive market size that is already the 4th largest superannuation savings pool in the world (note that Australia's economy ranks only the 14th biggest), comes the huge responsibility of ensuring these assets are invested appropriately, that the market is properly regulated and super fund members' interests are protected, and that the industry operates honestly and efficiently.
Rainmaker in 2016 estimated that total fees paid by fund members amounts to $25 billion, which is almost as much as Australia spends on its total national military defence program.
Table: Australia's superannuation market, 2016
|Segment||Sub-segment||Jun 2015||Jun 2016||Change||Accounts#||Funds*|
|Bal Stat Funds||56||53||-5%|
Source: Rainmaker Information and APRA
# Accounts refer to separate accounts members may have, noting a member may have accounts with several super funds.
* Funds refers to legal entities regulated by APRA or the ATO, noting that a 'fund' is not the same as a 'product', eg, a wealth group may offer several superannuation products into the market although in legal terms they are housed within a single regulated fund.
|Different Types of funds||How Superannuation Works|