Bounce in voluntary super contributions
Households lifted their voluntary superannuation contributions for the first time in more than a year during the December quarter, new analysis has found.
As global share markets took off in the last three months of 2012, the total value of funds pouring into superannuation hit $21.6 billion, an increase of 10 per cent from the much weaker September quarter.
Of this increase, $3.6 billion came from voluntary contributions by members – a 13 per cent increase on a year earlier.
Financial Services Council chief economist James Bond, who prepared the analysis using figures from the financial regulator, said this was the first time members' discretionary contributions into super had increased since September 2011.
Mr Bond said the bounce was probably a result of higher confidence among households and a run better performance on financial markets.
"We had growth in equities last year and we had a year of good returns for superannuation funds. Combined with an absence of bad news from Europe and the United States, this appears to have given people more confidence," Mr Bond said.
The increase comes after $117.5 billion was poured into super in 2011-12, the second-highest yearly inflow on record.
However, the latest increase is significant because until now, the rebound has been driven by employer contributions, which are mostly mandatory, rather than households voluntarily putting more into super.
Despite the quarterly bounce, over the year voluntary contributions fell slightly, and Mr Bond said market conditions were too fragile to predict a sustained rise in super contributions.
While the rise is welcome news for the funds management industry, which has been squeezed by greater caution among consumers, Mr Bond also said the growth was still much slower than before the global financial crisis.
Mr Bond's analysis is based on figures on the $1.4 trillion superannuation industry from the Australian Prudential Regulation Authority.