Less than 30 KiwiSaver schemes are expected to survive the Financial Markets Conduct Act (FMC) transition with the ‘bolt-on’ employer scheme sector slated for extinction.
To date, just six KiwiSaver schemes – including AMP, Westpac and Mercer – have shifted to FMC-mode with their respective documents now published on the Ministry of Business, Innovation and Employment (MOBIE) ‘Disclose’ website.
A further 29 schemes remain registered under the previous regime but seven of those have either formally given up – including Fidelity, Smartshares, Ravensdown and Staples Rodway – or are about to do so.
The latter group is understood to include the $2 million IwiInvestor and the last-two-standing employer ‘bolt on’ KiwiSaver schemes, Douglas Pharmaceuticals and Tait Communications. About 10 bolt-on schemes were launched with the birth of KiwiSaver in 2007 but the concept never took off.
As the KiwiSaver market narrows, there are early indications that most of the remaining traditional employer super schemes will muddle on in one form or another post the December 1 FMC deadline.
According to a recently-published FMC ‘Order in Council’, about 85 employer schemes would remain in operation while just over 30 (many of which are institutionally-owned retail products) will switch to legacy settings – closed to new members and effectively winding-up.
Outside the retail funds, just a handful of traditional employer schemes including the $220 million plus Westpac Retirement Plan have ticked the legacy option. As reported on Investment News NZ last year, the $300 million Defence Force Superannuation Scheme has also closed to new members.
However, the final tally of FMC survivors could fall further with at least one employer scheme listed as alive in the official document – the $100 million Fonterra fund – shuttering last year.