Presentation to the AIST YSN Lunch

1. 1 © 2014 Deloitte Touche Tohmatsu
Challenges of an ageing population
Stephen Huppert
Partner, Deloitte

2. 2 © 2014 Deloitte Touche Tohmatsu2 © 2014 Deloitte Touche Tohmatsu
Pillars of a retirement income system
Pillar 1 Age pension
Pillar 2 Compulsory superannuation contributions.
Pillar 3 Voluntary superannuation contributions and other savings

3. 3 © 2014 Deloitte Touche Tohmatsu3 © 2014 Deloitte Touche Tohmatsu
Total superannuation assets now over $1.7 trillion…
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
1997 2000 2003 2006 2009 2012 2015 2018 2021 2024 2027 2030 2033
$billions
APRA market statistics to
30 June 2012
APRA market statistics to
30 June 2012

4. 4 © 2014 Deloitte Touche Tohmatsu4 © 2014 Deloitte Touche Tohmatsu
…and projected to pass $7 trillion within 20 years
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
1997 2000 2003 2006 2009 2012 2015 2018 2021 2024 2027 2030 2033
$billions
APRA market statistics to
30 June 2012
Deloitte projections from
1 July 2012
~1.0 x GDP
~1.8 x GDP

5. 5 © 2014 Deloitte Touche Tohmatsu5 © 2014 Deloitte Touche Tohmatsu
Projected assets
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032
$billion

6. 6 © 2014 Deloitte Touche Tohmatsu6 © 2014 Deloitte Touche Tohmatsu
Projected assets pre & post retirement
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032
$billion
Post-retirement
Pre-retirement

7. 7 © 2014 Deloitte Touche Tohmatsu7 © 2014 Deloitte Touche Tohmatsu
Life expectancy and pension age
40
45
50
55
60
65
70
75
80
85
90
1881-1890 1946-1948 1975-1977 1994-1996 1999-2001 2004-2006 2010-2012
Life Expectancy at Birth
Life Expectancy at 65
Pension Age
Males, ABS Life Tables

8. 8 © 2014 Deloitte Touche Tohmatsu
© 2013 Deloitte Touche Tohmatsu8 © 2014 Deloitte Touche Tohmatsu

9. 9 © 2014 Deloitte Touche Tohmatsu9 © 2014 Deloitte Touche Tohmatsu
Future life expectancy and pension age
60
65
70
75
80
85
90
95
2010 2015 2020 2025 2030 2035 2040 2045 2050 2055
Life expectancy at 65 Current Pension Age
NCOA Proposed Pension Age Govt Proposed Pension Age
Govt Proposed Pension Age2
?

10. 10 © 2014 Deloitte Touche Tohmatsu
10 Compliance Considerations © 2013 Deloitte Touche Tohmatsu10 © 2014 Deloitte Touche Tohmatsu
Ownership of the assets
2013 2023 2033

11. 11 © 2014 Deloitte Touche Tohmatsu
11 Compliance Considerations © 2013 Deloitte Touche Tohmatsu11 © 2014 Deloitte Touche Tohmatsu
Trade offs in providing for old age

12. 12 © 2014 Deloitte Touche Tohmatsu12 © 2014 Deloitte Touche Tohmatsu
Pillars of a retirement income system
Pillar 1 Age pension
Pillar 2 Compulsory superannuation contributions.
Pillar 3 Voluntary superannuation contributions and other savings
Pillar 4 Extend work life, enable more part-time work

13. 13 © 2014 Deloitte Touche Tohmatsu
© 2013 Deloitte Touche Tohmatsu13 © 2014 Deloitte Touche Tohmatsu

14. 14 © 2014 Deloitte Touche Tohmatsu
© 2013 Deloitte Touche Tohmatsu14 © 2014 Deloitte Touche Tohmatsu
Retirement
Adequacy
Delay
Retirement
Education
& Advice
Products &
Investments
Increase
Contributions

15. 15 © 2014 Deloitte Touche Tohmatsu15 © 2014 Deloitte Touche Tohmatsu
The strategic objective of a superannuation fund is…
Maximise
Members’
Retirement
Outcomes
Net Investment
Returns
Operating
Costs
Products &
Services
Member
Behaviour

16. 16 © 2014 Deloitte Touche Tohmatsu16 © 2014 Deloitte Touche Tohmatsu
The strategic objective of a superannuation fund is…
Maximise
Members’
Retirement
Outcomes
Net Investment
Returns
Operating
Costs
Products &
Services
Member
Behaviour

17. 17 © 2014 Deloitte Touche Tohmatsu17 © 2014 Deloitte Touche Tohmatsu
Contact
Stephen Huppert
Partner
Deloitte
sthuppert@deloitte.com.au
@stephenhuppert

18. 18 © 2014 Deloitte Touche Tohmatsu
© 2013 Deloitte Touche Tohmatsu18 © 2014 Deloitte Touche Tohmatsu
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