Heads up about administration fee changes for your employees

This is a heads up to let you know about an administration fee increase for REST Super, REST Corporate and REST Select members. We thought you should know before we inform your employees from mid September. That way you’ll be aware of what’s happening and be more prepared if they ask any questions.
‘What are the new changes and when are they happening?’
In a nutshell, from 1 January 2018, the cost of managing REST Super and REST Corporate accounts (known as the administration fee) will increase from $1.10 per week to $1.30 per week.
REST Select will increase from $1.25 to $1.30 per week.
The changes at a glance
  Deducted from member account
Product Administration fee
  Before              1 Jan 2018 After                1 Jan 2018
REST Super $1.10 pw $1.30 pw
REST Corporate $1.10 pw $1.30 pw
REST Select $1.25 pw $1.30 pw

There’s no change in the administration asset based fee of 0.10% per annum for REST Super, REST Select and REST Corporate.

‘Why is the administration fee going up?’
REST have worked hard to keep this increase as low as possible. In fact, this is the first time REST Super has increased this fee since July 2013, and REST Select and REST Pension since January 2011.
However, fees need to increase every now and then to enable us to invest in creating the best possible tools and services to help our members with their super.
Innovative digital services, such as Roger and Live Chat, are just two of these recent investments. Read their stories for more information.
Plus, there’s no change in the administration asset based fee of 0.10% per annum of their account balance.
‘Is REST still competitive?’
Yes, REST has a history of low fees, and we’re still highly competitive.
According to independent research by Chant West Super Fund Fee Survey (March 2017), compared with other super funds, REST’s fees remain one of the lowest.
We’ll let our members know of the administration fee changes, in their annual statements and new members via updated PDSs.
                    1.    In their annual statement

Members will be notified in their annual member statement, which will be distributed over a month, starting mid September.

                    2.    Updated Product Disclosure Statements (PDS)
Our PDSs will be updated by 30 September 2017 to include the new administration fee.

Example of annual fees and costs for the MySuper product before and after the increase
This table provides an example of how the fees and costs can affect a MySuper member’s investments who invests in the Core Strategy investment option over a one-year period in REST Super or REST Corporate. 
  Deducted from member account Deducted from investment returns
  Administration fee pa Investment fee (0.60% pa) Total $ in fees pa % of account balance pa
Member Account Balance Admin. Fee pa ($1.30 pw) Asset based fee (0.1%pa)     New% / (Old%)
$5,000 $67.60 + $5.00 + $30.00   = $102.60 2.05% (1.84%)
$10,000 $67.60 + $10.00 + $60.00   = $137.60 1.38% (1.27%)
$25,000 $67.60 + $25.00 + $150.00 = $242.60 0.97% (0.93%)
$50,000 $67.60 + $50.00 + $300.00 = $417.60 0.84% (0.81%)
$100,000 $67.60 + $100.00 + $600.00 = $767.60 0.77% (0.75%)

The investment fee for Core Strategy is based on investment fees for the financial year ended 30 June 2017 and are an estimate of likely future investment fees only. The above table does not include the indirect costs for Core Strategy.