AUSTRALIA - The underperformance of Australian superannuation funds was down to a higher exposure to international shares and an underweighting in domestic stocks, according to asset consultants InTech Financial Services.
The latest InTech Major Funds Performance Survey provided performance details at total fund and sector levels, alongside the asset allocations of 19 of the largest superannuation funds in Australia, with minimum assets of AUD$500m. The survey revealed that the median major fund underperformed the median growth fund for the first time, year ending 30 June, 2001
The return of 5.9% achieved by the median major fund was the lowest in recent years and was 9.2% less than the previous year's return.
Average allocation to international and Australian shares was 27.1% and 35.4% respectively for major funds and 22.7% and 38.9% respectively for growth funds.
International shares performed poorly over the 2001 financial year, declining by 6% in Australian dollar terms, according to InTech. Australian shares on the other hand produced a solid return over the year gaining 9.1%.
By Janet Du Chenne
Enhanced powers for The Pensions Regulator (TPR) to prosecute and fine company directors who "wilfully or recklessly" put their defined benefit (DB) pension scheme at risk will be hard to enforce, commentators say.
Melrose has pledged to contribute up to £1bn to GKN's pension schemes as part of a final offer to acquire the engineering business.
Existing master trusts will be forced to pay £41,000 when applying for authorisation under the upcoming regime, the government has confirmed.
UPDATE 2 - DWP publishes DB white paper: Stronger powers for TPR, DB chair statements to be introduced
The Pensions Regulator (TPR) will be given the power to fine company bosses who deliberately puts their defined benefit (DB) schemes at risk, the government has confirmed.