The undercurrent of Australia’s ‘ocean’ of superannuation capital

InvestorDaily

Australia’s superannuation system has grown from a retirement safety net into a $4.5 trillion economic force — and managing it now demands a fundamentally different playbook. Australia’s compulsory superannuation system was introduced in 1992 to provide financial security for Australians in retirement, and to build a national pool of savings. But a “pool” is no longer an adequate descriptor for the capital managed by superannuation funds on. Today, that pool has become something far larger – an ocean of capital whose smooth and safe flow through the economy is now a matter of national importance.

The latest APRA Quarterly Superannuation Performance report lists the total size of Australia’s superannuation system at $4.5 trillion, a figure that represents around 150 per cent of GDP. Today, that places us squarely among the world’s largest pension systems. By 2035, Australia’s superannuation system is expected to overtake the UK and Canada to become the world’s second largest national pension fund.

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