HESTAf has more than 1.05 million members, administers $88 billion state pension funds. Yet their recent decision marks a historic turning point in operations and kicks off the biggest technology project in the fund’s 38-year history.
In February, the fund notified their members of the forthcoming legislative changes. It declared that they would not be able to reach most of its services until June at the earliest. This transition includes moving all member account services to GROW Inc., requiring the planned outage. Through this time frame, members will be made to move their cash – super contributions, investment switches, etc.
Transitioning to GROW Inc.
ATEST has ruled that after two years, HESTA should transfer its annual contract with GROW Inc. This action addresses one of the industry’s top priorities — concerns over ongoing, massive underinvestment in operations and maintenance. Xavier O’Halloran, director of Super Consumers Australia, emphasized the implications of this change for HESTA’s members.
“These kinds of delays are due to a lack of strategic vision about what superannuation funds are there to deliver, and that’s good customer service to consumers.” – Xavier O’Halloran, director of Super Consumers Australia.
The shift is designed to deliver tailored experiences for HESTA members, improving the way they engage with and take control of their superannuation. As per HESTA, this alternative cloud-powered technology platform will allow more frequent and seamless service delivery.
“Shifting to this new technology platform brings the opportunity to develop more personalised experiences for members, making it easier for them to manage their super.” – HESTA.
O’Halloran cautions that millions of consumers could be surprised by the service disruption. He anticipates a significant number of members will discover their inability to access services only when they attempt to do so over the next several weeks.
“I expect there will be a large number of consumers that will find out for the first time that they can’t access their service when they go to access them over the next seven weeks.” – Xavier O’Halloran, director of Super Consumers Australia.
Impact on Members
While HESTA transitions to a better model, members are experiencing the same problems right now. To that end, the fund has assured that they will make these income stream payments due in April or May early. We continue to work toward returning to regular payment schedules by mid-May. In practice, many members are raising serious alarm bells about their access to dollars right now.
Barbara Byng, HESTA member and artist Barbara Byng expressed her concern for the future.
“I know they’re about to go offline … I was just more stressed about my money and also about whether my money was safe.” – Barbara Byng, a member of HESTA.
The lack of opportunity for members to shift their dollars around during this transition period is an even bigger concern. Members are barred from switching their investments or adding new money until June. This delay can still leave them vulnerable to a big drop in the market during that time frame. O’Halloran warned against going for quick fixes at a time when much is up in the air.
“But I’d also urge a bit of caution around times of market volatility, about making big switches.” – Xavier O’Halloran, director of Super Consumers Australia.
Concerns Around Communication
Despite efforts by HESTA to communicate these changes through its website and media releases, there remains concern over how effectively the fund can reach its members. O’Halloran noted most superannuation funds have problems keeping their clients’ contact details up-to-date.
“There’s been information on their website and the media release, but I think where consumers are likely to be let down here is that we know superannuation funds often fail to keep up-to-date contact information on their members.” – Xavier O’Halloran, director of Super Consumers Australia.
This gap may result in a lack of awareness and comprehension from members who are not alerted as they should be about the upcoming service freeze. As O’Halloran reminded attendees, this kind of communication is critical during any major transition.
“And so have a really hard time in contacting them directly with relevant messages like this one.” – Xavier O’Halloran, director of Super Consumers Australia.
For HESTA, this is an exciting but critical transformation. Providing the most up-to-date information to our members and helping them prepare for these changes is our top priority right now. Depending on what comes out of this major project, it has the potential to change the way HESTA engages with members and provides services in the future.
