Restricted KiwiSaver and workplace super schemes could face a demand squeeze on independent trustees with just five licensed to date under the new Financial Markets Conduct Act (FMC).
Bruce Kerr, head of Workplace Savings NZ, said the “best guess” suggests 20-25 independent trustees should be adequate to service the super industry under FMC – depending on how many schemes survive the two-year transition period.
“About 20 to 25 independent trustees should be enough – assuming they all take on multiple [trustee] roles,” Kerr said.
However, he said on top of the five licensed trustees (a group that included Kerr), another “seven or eight” individuals are considering applying for a licence.
“We’ll be lucky to get 15 trustees if they all do get licensed,” Kerr said. “It’s hard to see where any others will come from.”
According to the Financial Markets Authority (FMA), in addition to the five already licensed, two more independent trustee licence applications are being processed.
Under FMC rules all restricted investment schemes, which includes workplace super funds and a handful of KiwiSaver schemes, are required to include at least one independent trustee on their boards.
Currently, about 150 employer superannuation schemes are registered with the FMA but that number is expected to reduce drastically as the two-year FMC transition period – due to expire in December 2016 – draws closer.
As well as Kerr, the FMA licensed independent trustee register lists: Timothy McGuinness; Gordon Sproule; Charles Cahn; and, Brian Mason.