Superannuation funds must consolidate if they are to remain viable, according to Association of Superannuation Funds of Australia (ASFA) chief executive Pauline Vamos.
At the 2008 ASFA conference held in New Zealand yesterday, Vamos said mergers need to be encouraged because superannuation funds will need more cashflow to cope with the needs and expectations of the ageing population.
Major investment is necessary for infrastructure enhancements, to engage members before and after their working lives, Vamos said.
ASFA director of policy and industry practice Melinda Howes said there needed to more innovative products that deal with longevity risk.
"We need to give everyone a projection of their superannuation... what their superannuation would be if they were putting in more money, and a guide to how much age pension they could expect," Howes said.
"There is also a need to manage investments properly and having more training and development for trustees. That takes money," she said.
Vamos said that ASFA was actively discussing the issue with government and regulators.
"Being able to merge in our industry should be encouraged by more regulation and disclosure," she said.
Health Super chief executive Chris Clausen agreed, saying: "As we go forward, the focus will be on ways that that could be done, especially now that we are within a more difficult time."
