miwahni (miwahni) wrote,
miwahni
miwahni

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On the buses

A number of buses around the city have big advertising signs, suggesting to ex-government employees that they'd be doing a good thing for themselves by leaving their superannuation balances in the state government super scheme, Q Super. I daresay they'd be doing an even better thing for the super fund; if you crunch the numbers you can see why Q Super is so worried that the redundancies will hurt their bottom line.

Firstly here's the investment stream they'll lose - if you work on approximately 15,000 public servants axed, and assume an average income of $60,000 ongoing, that's $900,000,000.00 worth of income paid to these people over a year; the super guarantee minimum of 9% represents eightyone million dollars in lost investments in a year if each and every one of those employees sets up a new super fund with their new jobs. That's not including the hit that the fund would take if each of those ex-employees also rolled their existing Q Super balances into their new funds.

Management fees for this fund vary, depending on the investment options chosen by the members, but the lowest is .29% for cash and shares, all the way up to .94% for the Socially Responsible investment. The mid point is .615% which represents lost revenue of $498150 on the lost $81,000,000.

Now taking it a step further, and assuming that at least half of those 15000 redundant people take their existing balances elsewhere, and let's assume an average fund balance of $60,000 - that's $450,000,000.00 being rolled out of Q Super and into other funds - just on the initial rollover the govt would lose a whopping $2,812,500 in revenue stream.
More than justifies their ad campaign, I think.
Tags: bureaucracy, money, politics, real life, trivia
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