Industry superannuation fund First State Super (FSS) does not expect to lose its competitive strength when MySuper is introduced.
The super fund, which has the lowest fees in the industry, said it believed its past performance and brand were strong enough to endure the competition from the low-cost default options of other funds.
"All of our research shows that there is strong brand loyalty," FSS chief executive Michael Dwyer said.
"Our members are loyal to our fund, not only for cost reasons. They don't lie awake at night thinking about their superannuation fund."
Dwyer said that as long as the fund delivered good returns over time at the lowest possible rate, members would not be inclined to switch to another fund.
But he acknowledged the proposed default fund under MySuper was very similar to FSS's flagship fund.
"In our discussions with the Cooper panel we were considered somewhat of a model for the default option they were suggesting, so from our perspective the 70/30 fund that we've got at the moment is almost an exact mirror of what the Cooper panel were looking to recommend," he said.
The likeness did not mean other funds would introduce a default option at the same price level as FSS, he said.
"The Cooper panel is talking about a cost of 1 per cent or just below 1 per cent," he said.
"I can tell you that we are many times below that. We have 0.37 per cent in total cost on a $50,000 account balance."
Dwyer was largely positive about the proposals under MySuper, but said he was concerned it would lead to a rise in costs in the short term and would impact on members differently.
"Our view is that MySuper has brought about a lot of positive recommendations, if you consider SuperStream as part of MySuper," he said.
"SuperStream has strong support from us and other players in the industry in terms of better use of electronic funds transfer, better use of tax file numbers, streamlining back-office arrangements, but we are not blind to the fact that many of these changes are going to cause a cost to be levied on the funds to bring about these changes and that means ultimately costs on members.
"I think it is going to be certain generations of members that will get the pure benefit, as opposed to others that might have to bear the cost as well as see some of the benefits."
