News round-up: July 2

Adviser groups left off the list; Guardians win an award; health funding bigger than superannuation

Monday, July 2nd 2012, 6:00AM

by Niko Kloeten

The Financial Markets Authority hasn't snubbed adviser groups despite not mentioning them in its latest tome, Institute of Financial Advisers chief executive Peter Lee says.

The FMA's statement of intent for 2012-2015 mentions a number of "stakeholders" who were consulted including the Commission for Financial Literacy and Retirement Income, the New Zealand Institute of Chartered Accountants and Serious Fraud Office, but no group representing financial advice.

However, Lee told Good Returns that the FMA had consulted with the IFA, albeit for an earlier version of the statement.

"Not in this specific one but for the early one [the statement of intent for 2011-2014 which was released last November] we were; there was a lot of stuff in there around what we expected the FMA to be doing."

He said the current statement of intent didn't have much to do with financial advice and was more about "how to make sure the markets work".

Guardians win award

The Guardians of the New Zealand Superannuation Fund have won the inaugural executive team of the Year Award at the 2012 New Zealand CIO Awards.

The fund has more than $19 billion in assets, including around $4 billion invested in public and private companies in New Zealand.

The judges said they were impressed with the high calibre of teamwork demonstrated by the Guardians during the deployment of a new operational platform that has allowed reconciliation of daily investment transactions and reporting on a whole-of-fund basis.

"The CEO, Adrian Orr, led the project at a strategic level, the executive members kept the outcomes focused on the business and the ICT team, led by Greg McHugh, ensured technology outcomes were achieved," the judges said.

Orr said top quality IT systems were essential. "As well as managing and reconciling a large volume of daily transactions, we need accurate, easily accessible information to help make the best long-term strategic decisions for the fund."

Health costs bigger than superannuation

The looming health funding crisis is a bigger problem in New Zealand than the retirement savings debate, according to Health Funds Association chief executive Roger Styles.

He said the landmark decision by the United States Supreme Court to uphold "Obamacare" shows future funding of healthcare is the biggest public policy issue of our time, and New Zealand is more exposed than most countries in the OECD.

"We have a dangerous over-reliance on public funding compared to the OECD average, and have the fifth-highest Government health spending of any OECD country as a percentage of GDP," he said.

"Rebalancing of public and private shares will occur in New Zealand in the next two decades. The question is whether it will be planned or haphazard. I believe a planned approach will deliver better health outcomes all round."

Mr Styles echoed the call from the Treasury, which in its recent long-term fiscal update called for broad public debate on the policy options for future health funding.

Niko Kloeten can be contacted at niko@goodreturns.co.nz

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