Changes to APRA’s accounting standards suggest that the superannuation sector is closer to $2.7 trillion than the $2.5 trillion reported in the regulator’s latest statistics.
Due to a change in APRA's accounting standards (specifically, AASB 1056 Superannuation Entities), total assets in the September edition of the prudential regulator's quarterly superannuation performance statistics jumped $200 billion to $2.5 trillion.
"This [accounting change] makes employer sponsor receivables (particularly for public sector funds) recognised as an asset on fund balance sheets," according to industry consultant Rice Warner.
"Essentially this means that c. $180 billion of unfunded public sector liabilities are now included in the APRA statistics."
But because the change was backdated to September 2016 and appears to be net of Future Fund assets, the size of industry liabilities could arguably increase by a further $200 billion.
"The size of the public sector superannuation benefits nearly double when taking these liabilities into account and the sector’s average balances increase to about $203,000," said Rice Warner.
This would mean the size of superannuation industry size benefits now totals $2.7 trillion, said Rice Warner.
"Our new projections show the superannuation industry will grow to $4.3 trillion in 2032 (in 2017 dollars). On its way to reaching 180 per cent of GDP in the 2040s," it said.
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