The new chief executive of West Australian public sector fund the Government Employees Superannuation Board (GESB), Howard Rosario, does not expect his new employer will compete with AustralianSuper's newly-established WA arm, the former Westscheme fund.
"There will be no competition. This is a scheme for Western Australian public servants. Their employers use this fund and they operate under state legislation," Rosario said.
"There is no question of competition, because the employers cannot use any other fund anyway under that legislation."
However, Rosario will be tasked with implementing choice of fund for the members of GESB, which would leave its members free to join any other fund.
"With the board's guidance, Mr Rosario will oversee the implementation of choice of superannuation fund for public sector employees and the possible move by GESB towards being a greater procurer of superannuation services," GESB chairman John Langoulant said earlier this week at the appointment of Rosario.
The WA government had previously considered a mutualisation of GESB, but decided against the measure in April 2010 following a review of the fund.
At that time, the state government did say it would seek to introduce a one-way choice of fund for the WA public sector, allowing members of GESB to opt for another fund, but not opening GESB up for employees outside of the state's public sector.
A merger of GESB with another public sector fund was not on the cards, Rosario said.
Rosario played an important role in the merger between Westscheme, of which he was the chief executive, and AustralianSuper, resulting in an amalgamation of the two funds in June last year.
A merger was in the best interest of members because it was increasingly difficult for a fund the size of Westscheme, at $3.4 billion, to offer competitive services without increasing member fees, Rosario said at the time.
But for GESB, a $12-billion fund, the situation was different, he said.
"GESB is much bigger. It is a substantial organisation and in Western Australia it has even a greater purpose," he said.
"And survival depends on a whole lot of factors."
GESB, for example, was not just an accumulation fund, but had a range of different offerings, including a defined benefit component, he said, attracting different members than an accumulation fund.
The fund has ambitious targets for 2012, including moving to a strategic asset allocation strategy and developing a global infrastructure strategy.
Rosario said he had full confidence in GESB's investment team to take on the changes.
"I'm here to encourage, motivate and make the most of the talent that is available to GESB, and it is a demonstrated talent," he said.
"I think the investment team has shown that it has done very, very well. I'm here to encourage that team to continue to deliver those good returns to members."
