GES Board records strongest performance in over decade

15/12/94

The State Government Employees' Superannuation Board has recorded its strongest performance in over a decade, according to its annual report tabled in State Parliament today.

Finance Minister Max Evans said the highlight of the report was the marked turn-around in the investment performance of the GES Fund.

Mr Evans said the return for the year of 12.5 per cent (up from 2.3 per cent the previous year) was an outstanding achievement, particularly given the portfolio's heavy overweighting in new CBD property.

"This significant improvement on recent years has been achieved during a period of substantial growth in the portfolio - up nearly 20 per cent to $862 million," he said.

The Minister said the board's performance and returns compared most favourably with other funds.

Based on Mercer's Pooled Fund Investment Performance Survey of 36 funds, the board's return of 12.5 per cent would have ranked third and was well in excess of the survey's mean of 8.6 per cent.

"After allowing for inflation - the real rate of return of 10.8 per cent is the board's strongest performance for at least 10 years," Mr Evans said.

He said another key feature of the board's superannuation operation for the year was the strong growth in membership - up 42 per cent.

"Combined with last year's strong growth, membership levels have risen by nearly 60 per cent in two years," he said.

Mr Evans said the results of the board's first-time participation in the Association of Superannuation Funds/Ernst and Young Administration Cost Survey had reflected well on its operations.

"The results, which were in respect of 1993, confirmed the board's relative position as a low-cost operator by industry standards," he said.

"In terms of costs per member, the board's administration costs were less than half the all funds average and 30 per cent below the large group average."

Board chairman Peter Williamson said this year's strong performance was the result of the board's sustained effort and disciplined approach to the management of its investments.

He said the recent upturn in the property market, after several depressed years, had very positive implications for the board.

"Throughout the downturn, the board stuck to a firm strategy for its property portfolio, especially in leasing of its prime CBD office complex Central Park, and is now well placed to take advantage of the rising market," Mr Williamson said.

Media contact: Paul Plowman 222 9595