Royal Commission FAQs

ESSSuper in the context of the recent Royal Commission hearings.

You may have seen that some superannuation funds have recently been in the news as part of the August round of Royal Commission into Misconduct in the Banking, Superannuation and Financial Services hearings.

As an exempt public sector superannuation fund regulated by the Victorian Government, ESSSuper is exempt from the Royal Commission. While we can’t remark on the proceedings, we can reflect on some of the key topics as they relate to our focus on delivering the best possible member service.

Who is ESSSuper?

ESSSuper are proud to be the dedicated, not-for-profit super fund serving Victorian emergency services and state employees. With award-winning products and services, we exist to provide better retirement outcomes for our members.

Our funds are specific to a particular group of eligible members, but our Accumulation Plan and Income Streams which are operated in compliance with Victorian and Commonwealth legislation^ are accessible to all ESSSuper members and their spouses (subject to eligibility requirements).

ESSSuper’s services are specifically tailored to meet legislative requirements and the needs of our members. We pride ourselves in having a value for money proposition for our members:

• This was recently reaffirmed by independent superannuation research company SuperRatings, which recognised ESSSuper’s Accumulation Plan as a "best value for money" for nine consecutive years.

• Members also continue to rate us highly for service and satisfaction, as shown in the most recent Investment Trends Quarterly Industry Benchmark survey.

Why haven’t I seen any mention of ESSSuper in the Royal Commission?

ESSSuper is an exempt public sector superannuation fund and is therefore exempt from the Royal Commission.

How is ESSSuper governed?

ESSSuper operations and activities are regulated by the Victorian Government, not the Australian Prudential Regulation Authority (APRA) and Australian Securities and Investments Commission (ASIC).

However, ESSSuper also complies with the prudential regulation, standards and best practice guides issued by APRA and ASIC and applicable federal superannuation legislation, including the Corporations and Superannuation Industry Supervision (SIS) Acts.

Does ESSSuper support the outcomes of the Royal and Productivity commissions?

ESSSuper is supportive of improving the practices and efficiency of the superannuation industry. The industry is highly resilient and will adapt to changes in the best interests of all Australians.

Does ESSSuper financial planning services offer fee-for-service?

ESSSuper has an arrangement with Adviser Network Pty Ltd* to provide financial product advice to members that is fee-for-service.

Our qualified financial advisers are employees of ESSSuper and are authorised by Adviser Network to provide personal financial advice, under Adviser Network’s AFSL. They not only understand the unique complexities of ESSSuper funds, but are also able to advise on more than just members’ super.

Fees for personal advice can range from $275 - $5,000 depending on the type of advice provided to members. However, a higher fee may apply depending on the complexity of the member’s situation. ESSSuper advisers do not receive any commission or special payments for providing financial advice or products.

Does ESSSuper have any sponsorships that detract from our sole purpose of looking after members?

As a not-for-profit organisation, ESSSuper doesn’t enter into sponsorships to raise our profile.

ESSSuper and its employees do however actively support charities, such as the Women in Super’s Mother’s Day Classic and volunteering at The Salvation Army’s Hamodava Café.

How does ESSSuper disclose their fees on member statements?

ESSSuper provides fees and costs information to members consistent with the Corporations Act and the disclosure requirements of ASIC’s Regulatory Guide 97. This includes the transparency measures designed by ASIC to disclose the nature and extent of indirect costs charged to members.

On the 2018 Annual Benefit Statement, members will see that other management costs have been split into Indirect Costs and Investment Fees. In addition, the statement also shows Borrowing Costs.

How does ESSSuper provide insurance for our Defined Benefit members?

ESSSuper provides DB members with death and disablement benefits not readily available in the marketplace, particularly for our members for whom risk is part of their everyday work. This includes access to a range of benefits for retirement, resignation, death, disability, retrenchment or dismissal.

ESSSuper DB schemes have been self-insured and underwritten by the Victorian Government for nearly 100 years. As a result, over time we have built up significant expertise and a robust medical assessment process. This puts ESSSuper in a much better position to advocate for our members.

Our DB members don’t pay insurance premiums for their Death and Disablement benefits. Members also have the option of boosting their insurance coverage by opening an ESSSuper Accumulation Plan at an additional cost. All ESSSuper DB members have death and disablement benefits, regardless of their health status.

How does ESSSuper provide insurance for Accumulation Fund members?

ESSSuper provides insurance cover for Death only, Death and Total and Permanent Disability and/or Income Protection.

Against the industry trend, ESSSuper has not had an increase in premiums for 10 years and recently ESSSuper obtained a guarantee to lock in its competitive premiums for a further two years.

Our members may elect to be covered for death, disability and income protection benefits with an ESSSuper Accumulation Plan. While members can open as many accounts as they wish, they can only choose to have insurance apply to one of these accounts.

On receiving employer contributions (SG) into an Accumulation plan, our default insurance cover applies – of which members can choose to opt out. This ensures our members receive a minimum level of insurance cover.

Default insurance costs reflect the members’ age and occupational category. Additional costs apply if members elect - and are successfully underwritten for – higher amounts of insurance than the default.

We also regularly seek feedback about our products and services so we can make sure they’re continuing to meet our member’s needs.