As previously communicated, in March 2014, the NSW Government announced its intent to amalgamate the funds management activities of the State’s financial assets within NSW Treasury Corporation (TCorp). This relates to the Defined Benefit [1] (DB) assets within the STC Pooled Fund.
In response to this, over the past year, State Super has been assessing the benefit and suitability of outsourcing certain funds management activities to TCorp.
The Board of State Super has, after a full due diligence process, resolved to appoint TCorp as an outsourced service provider of certain funds management activities in relation to DB assets. It is anticipated that the arrangement will commence from 15 June 2015.
TCorp will provide funds management services in relation to the Trustee Selection Strategy (formerly called the Growth Strategy), which primarily invests employer funded (or defined benefit) assets. The services being provided by TCorp will include undertaking functions such as recommending investment managers, conducting due diligence, funds administration and operations and reporting activities. The appointment is considered to be in the best interests of the beneficiaries of the State Super Schemes.
State Super will maintain the resources and staff required to continue to meet our regulatory and fiduciary obligations, which include retaining responsibility for member services and investment governance (including setting investment objectives and strategies, risk management and asset allocation) for all the State Super investment strategies. State Super will also continue to manage the four member investment choice strategies (Growth, Balanced, Conservative and Cash) in which SASS DC assets are primarily invested and the two university investment strategies (University Diversified* and University Cash) in which university employer reserves are invested.
*The University Conservative Diversified Strategy closed on 28 February 2021.
What does this mean for members?
There is no change to benefit design or entitlement and all benefits will continue to be paid in accordance with the relevant scheme legislation. All assets, whether they are member or employer funded will remain in the State Super Pooled Fund and the strategy they are currently allocated to (other than the DB reserves).
About TCorp
New South Wales Treasury Corporation (known as TCorp) is the central borrowing and financing authority for the State of New South Wales. TCorp is also a manager of asset and liability portfolios on behalf of clients, providing financial risk management and investment management services to the NSW Government and its constituent businesses.