Site Designed By Airnet
Super transfer super-slow from Australia
 
Q.           I have applied to transfer my Australian super across into my KiwiSaver which is with ASB. When I talked to ASB about it they said it should be done within 30 days, but the Australian company Sun Super have contacted me to say they are not ready to transfer yet. My balance has been going down every year and I am worried that their fees must be very high. The longer it takes the more it’s costing me. I am not happy with the communication and service I have been getting from ASB. How long is it going to take for my Aussie super to be transferred?
 
A.           Back in 2009 New Zealand and Australia signed the Transtasman Portability Agreement, to encourage the flow of labour both ways across the Tasman and to enable workers to consolidate their retirement savings at some point.

While New Zealand put the necessary legislation in place way back in 2010, we have been waiting for Australia to reciprocate. Legislation was finally passed in Australia in 2012, and came into effect on 1 July 2013. You will gather from this that while New Zealand is willing and eager to get on with the transfer of super across the Tasman, Australia has shown less motivation. It therefore doesn’t surprise me to hear that your Australian fund manager expects it to take longer at their end than ours. 
 
Under the agreement, providers have 30 days to process transfer requests once they receive completed documentation and supporting evidence. What if it takes longer than 30 days? I have heard that it could be months rather than weeks before the first sums of Aussie super reach KiwiSaver accounts. Account holders may complain about delays, but fund managers will no doubt say that they are proceeding as fast as possible given the challenges of setting up new and robust processes which will meet all legal requirements. 
 
You worry that fees are eating into your returns. In fact, Sun Super fees are not dissimilar to ASB KiwiSaver fees, so delays should not be costing you money. 
 
You have expressed dissatisfaction in your dealings with ASB. ASB is the second largest KiwiSaver manager with over $3 billion under management. On a typical working day they may have a large number of investors seeking help and advice from a limited number of staff members. 
 
I asked ASB to comment on your situation. Blair Turnbull, ASB Executive General Manager Wealth and Insurance replied: “We are sorry to hear of your frustration over Sun Super in Australia not yet being able to transfer your Australian retirement savings to the ASB KiwiSaver Scheme.   Despite the legislation (which came into effect on 1 July) stating Australian providers have 30 days to process completed transfer requests, some Australian funds are still developing the systems and processes they require to complete the transfers.   Providing the best possible service is important to us, and we are keeping a register of all Australian funds and monitoring when they are ready to make transfers.  We would welcome the opportunity to discuss the situation with you in more detail, and invite you to contact us on 0800 272 738.”
 
Readers need to be aware that funds transferred from Australian super will be identified within their KiwiSaver account and will be subject to different rules. For instance, Aussie super cannot be withdrawn for a first home purchase, although any increase in value through investment returns may be. Transferred Aussie super funds do not count towards Member Tax Credits, but they may be accessed at age 60 if the account holder meets the Australian definition of ‘retired’. 
 
Any readers thinking about transferring Aussie super to their KiwiSaver would be wise to seek qualified advice to assess all the advantages and disadvantages for their particular situation.
 
 
Shelley Hanna is an Authorised Financial Adviser FSP12241. Her disclosure statement is available on request and free of charge by calling 870 3838. The information contained in this article is of a general nature and is not intended to provide personalised advice. Send your KiwiSaver questions to shelley.hanna@peak.net.nz. You can read earlier columns at www.peak.net.nz