Kiwi Wealth KiwiSaver Scheme. Annual Report

Transcription

1 Kiwi Wealth KiwiSaver Scheme. Annual Report for the year ended 31 March 2017

2 ` Welcome to a year in the life of Kiwi Wealth Welcome to the annual report of the Kiwi Wealth KiwiSaver Scheme (the Scheme). This year s been a pretty crazy one here, at a glance, is the good, the bad and the downright weird stuff that s happened in the past year. THE GOOD We launched our online tool Future You which shows members how much you could expect to have in your KiwiSaver account by the time you retire and lets you set goals for your retirement. Find out all about it on page 3 of this annual report. Our performance across all of our investment funds was positive and we made some great gains on behalf of our members.. THE BAD We were hit quite hard by the Kaikoura earthquake in November, which forced us out of our Wellington offices while they were assessed for structural damage. However, we got our backup sites up and running quickly and remained fully operational. To ensure we re not as severely affected by any future natural disasters our Customer Services Team are now permanently located outside of the Wellington CBD, in Porirua. THE DOWNRIGHT WEIRD Politics took a turn for the strange in 2016, with populism on the rise, in the form of Britain s referendum vote to leave the European Union (EU) in July and the election of Donald Trump as US President in November. Both events affected global markets as investors reacted to the news. WHY KIWI WEALTH GOES GLOBAL At Kiwi Wealth, we place a significant portion of our investments (i.e. your money) in overseas markets, like the US and the UK. This is partly a straightforward don t put your eggs in one basket approach. If you ve got a house and a job in New Zealand, you re pretty exposed to local economic problems. If your money is also invested in the NZ share market, and a downturn comes, your finances could take a real hit. Having a decent spread of investments overseas, however, means your wealth isn t as vulnerable to any one problem. NZ s share market is tiny compared to global markets; overseas offers a huge variety of companies, sectors and industries to invest in. Investing overseas won t be for everyone though, but in the long-term and KiwiSaver is all about the long-term we believe that taking a global approach to your money offers the best potential for success. For more information on our performance check out our website

3 Future You a new way of looking at your KiwiSaver account An online tool built with, and for, our members to help make planning for retirement easier. WE WANTED TO MAKE PLANNING FOR RETIREMENT EASIER You deserve to live your best life in retirement, but how can you know if you re saving enough to have a future you ll love? We saw an opportunity to use technology to help our members answer this question, by showing you what planning for retirement really looks like. So we created an online tool you could interact with in the same way as other digital tools, like social media. It s called Future You. HOW WE CREATED FUTURE YOU Future You is an easy-to-use online tool available through your Kiwi Wealth KiwiSaver Scheme account. To create something that worked for our members, we talked to you about what you wanted to achieve with your lives and what we could do to help you. Taking this info, we designed a prototype tool, which we tested with a small group of our members, they provided feedback on what worked and what didn t. We then reworked the design, continuing to test it with members, until we were ready to launch a version to all eligible members in April The Future You tool is available to members who are aged between and who have not made a transfer from an Australian complying superannuation fund. $ - 3 -

4 Future You empowers you to take control of your retirement Work out if you re saving enough to get a retirement that you ll love. Choose between one of three different retirement lifestyle options No Frills, Flexible, and Deluxe based on an estimate of each lifestyle s cost. Or you can input your own lifestyle goal - if you know the kind of retirement you want and how much it will cost. Using your account info current balance, investment fund, contribution rate and retirement age Future You works out how much you could expect to have when you retire. It also compares your estimated future balance with your selected lifestyle goal and shows you whether you re on or off track to meet it, and how much extra you ll need to save per week to achieve your goal. You can then make changes to your KiwiSaver account and see the impact they could have on your future KiwiSaver balance. You can also choose whether you want to include NZ Super in your estimated future KiwiSaver balance. WHAT S NEXT? We re proud of our innovative service at Kiwi Wealth. We re continuing to develop Future You, building up the online service we offer our members, so we can better help you save for your future. We ve asked our members what additional features Future You could have that would be useful. You ve told us you want the ability to include your other retirement assets, in addition to your KiwiSaver account and NZ Super, into the Future You tool, so you can get an even more complete picture of how you re tracking towards retirement. Using our innovative approach, we re hard at work bringing this, and many other new features, to our members

5 WHAT DO PEOPLE THINK? Here are some things members who have used the Future You tool have said about it: An excellent guide which helps by saving time in having to research other websites for information. As I hadn t looked into superannuation before, it was very helpful to see an estimate and also made me realise how little there is to expect from that source once retiring. It is very useful. It is clear and easy to understand. Now I know that I need to up my payments to have a more financially savvy retirement. Found it thought provoking and useful tool. It s not only our members who think Future You is pretty helpful, the World Pension Summit confirmed that Future You is a finalist in their 2017 Innovation Awards. It is nominated in the category of Communication / Member Engagement Innovations. We look forward to hearing the result! Details of the Scheme The name of the scheme: Kiwi Wealth KiwiSaver Scheme The type of scheme: KiwiSaver scheme The name of the manager: Kiwi Wealth Limited The name of the supervisor: Public Trust The date of the latest Product Disclosure Statement: The latest Product Disclosure Statement is dated 29 July 2016 Status of Product Disclosure Statement: Open for applications The date of the latest fund update for each fund to which the scheme relates: The latest Fund Updates are dated 28 July 2017 The date of the latest financial and auditor s report: The Scheme s latest audited financial statements (including the auditor s report) for the year ended 31 March 2017 were lodged with the Registrar on 28 July

6 Information on contributions and scheme participants Total number of scheme participants: 1 April 2016: 153, March 2017: 174,265 Total amount of scheme participants accumulations, and the number of scheme participants to which that relates: TOTAL AMOUNT TOTAL MEMBERS As at 1 April 2016 $2,479,436, ,179 As at 31 March 2017 $3,030,682, ,265 Total number of contributing scheme participants: 1 April 2016: 102, March 2017: 114,941 Total number of non-contributing scheme participants: 1 April 2016: 50, March 2017: 59,324 Total number of persons who became scheme participants: Total: 34,365 New members: 14,434 Transfers in: 19,931 Total number of persons who ceased to be scheme participants: Total: 13,300 Retirement: 1,608 Deceased: 152 Transfers out: 10,229 Other: 1,311 Total amount of contributions received during the period and the number of scheme participants to which this relates: AMOUNT MEMBERS Member contributions $202,590, ,564 Employer contributions $118,028, ,248 Member voluntary additional contributions $54,403,000 32,892 Total contributions $375,021, ,

7 AT THE START OF THE PERIOD WE HAD ,179 Total participants (x10,000) AND AT THE END WE HAD ,265 Total participants (x10,000) FUNDS UNDER MANAGEMENT AS AT 1 APRIL 2016: $2,479,436,000 FUNDS UNDER MANAGEMENT AS AT 31 MARCH 2017: $3,030,682,000 TOTAL MEMBER CONTRIBUTIONS FOR THE YEAR: $375,021,000 TOTAL NEW MEMBERS FOR THE YEAR: 34,365 New to KiwiSaver 14,434 Members transferred from other schemes 19,

8 Changes relating to the scheme CHANGE TO THE OFFER DOCUMENTS As of 29 July 2016, the requirements of the Financial Markets Conduct Act 2013 (FMCA) applied to the Scheme and so we replaced the investment statement and prospectus, which we used to give to people thinking of joining the Scheme, with a product disclosure statement (PDS). The PDS uses a standard format and prescribed language to give people the key info they need when deciding whether or not to invest. You can download a copy of the Kiwi Wealth KiwiSaver Scheme PDS from our website CHANGES TO OTHER DOCUMENTS We ve also made some changes to our statement of investment policies and objectives (SIPO). The changes were made to comply with the requirements of the FMCA. Other than that, nothing significant changed within these documents or the terms of the offer of interests in the Scheme during the year ending 31 March To find out more, you can get a copy of each of these documents from the Disclose Register at nz/disclose by searching Kiwi Wealth KiwiSaver Scheme. You can also download a copy of the trust deed or SIPO from our website, OTHER CHANGES There are a few other changes that have taken place over the KiwiSaver year: Our investment portfolios are now called investment funds. References to the Trustee have changed to the Supervisor. And from the financial quarter ending 30 September, periodic disclosure statements are now called fund updates. RELATED PARTY TRANSACTIONS There were no material changes to the nature or scale of related party transactions for the Scheme. All related party transactions during the year to 31 March 2017 were on an arm s length basis and enacted on normal commercial terms

9 Other information for particular types of managed funds WITHDRAWALS The number of members who made a withdrawal during the Scheme year were as follows: REASON FOR WITHDRAWAL NUMBER OF MEMBERS First home (and second chance) withdrawal 1,787 Significant financial hardship 1,551 Serious illness 143 Permanent emigration 97 Deceased 152 End payment date (retirement) withdrawal 2,723 REASONS FOR WITHDRAWAL FIRST HOME SIGNIFICANT FINANCIAL HARDSHIP SERIOUS ILLNESS PERMANENT EMIGRATION DECEASED RETIREMENT - 9 -

10 A look back INVESTMENT PERFORMANCE The below table shows the crediting rate or rates applied to members balances for the accounting period as at the end of that period. This means the investment returns applied to the particular funds your money is invested into. We also take into account the prescribed investor rate applied to your KiwiSaver account. SCHEME INVESTMENT FUND PRESCRIBED INVESTOR RATES 10.5% 17.5% 28% Cash 2.44% 2.24% 1.96% CashPlus 2.37% 2.20% 1.95% Conservative 3.43% 3.23% 2.94% Default 5.23% 4.99% 4.65% Balanced 7.21% 6.95% 6.55% Growth 10.79% 10.45% 9.94% MANAGER S STATEMENT The Manager of the Scheme, Kiwi Wealth Limited, confirms that all the benefits required to be paid from the Scheme in accordance with the terms of the governing document and (where applicable) the KiwiSaver scheme rules have been paid; and the market value of the Scheme property at the end of 31 March 2017 equalled or exceeded the total value of benefits that would have been payable had all members of the Scheme ceased to be members at that date and had provision been made for the continued payment of all benefits being paid to members and other beneficiaries as at the balance date

11 Changes to persons involved in the scheme CHANGES TO THE MANAGER On 31 October 2016 Change to the ownership structure of the parent company that owns Kiwi Wealth Limited. Kiwi Wealth is a wholly owned subsidiary of Kiwi Group Holdings Limited, which in turn was 100% owned by New Zealand Post Limited. New Zealand Post sold 47% of that holding company to the Guardians of the New Zealand Superannuation Fund (25%) and the Accident Compensation Corporation (22%). On 16 March 2017 Michael O Donnell was appointed to the Board of Kiwi Wealth Limited. CHANGES TO THE SUPERVISOR S BOARD On 30 April 2016 Susan McCormack s term as a Board Member ended. On 31 October 2016 Diana Puketapu and Dinu Harry retired as Board Members of Public Trust. On 1 November 2016 Three new Board Members commenced their term as Board Members of Public Trust: Dianne Victoria McAteer of Auckland Bevan Edward Killick of Christchurch Graham Arthur Naylor of Tauranga. On 1 February 2017 John Ross assumed the role of General Manager, Corporate Trustee Services

12 How to find further information Further information relating to the Scheme, including financial statements, annual reports, the Scheme s trust deed, and SIPO is available on the scheme register at disclose. The quarterly fund updates, the PDS, and other material information is available on the offer register at A copy of the information on the offer register or scheme register is available on request from the Registrar of Financial Service Providers. The above information is also available free of charge at or by contacting us through one of the ways listed on page 13. Once the processing of your application has been completed, you can view monthly online reports and other information about your investment by logging on through or through Kiwibank internet banking (if you are a Kiwibank customer with access to Kiwibank internet banking). You will also be sent an Annual PIE Tax Statement which will include the amount of PIE income attributed to you and the amount of PIE tax paid at your PIR. You will also be asked to confirm your IRD number and PIR. You can obtain general information about us and the Scheme at

13 Contact details and complaints We d love to hear from you, the good, the bad and the ugly! If you d like to get in touch, please contact us through the following channels: Online: Call: during normal business hours questions@kiwiwealth.co.nz Write to: FreePost Kiwi Wealth Limited PO Box Porirua 5240 Attention: Kiwi Wealth KiwiSaver Scheme Customer Services Manager

14 Contact details and complaints cont. THE MANAGER If you have a complaint, ensure your letter is clearly addressed using the details on the previous page: Attention: Kiwi Wealth KiwiSaver Scheme Member Complaints Officer We are a member of the Insurance & Financial Services Ombudsman Scheme (IFSO), an approved dispute resolution scheme. If you have complained to us and you have reached the end of our internal complaints process without your complaint being resolved to your satisfaction, the IFSO may be able to consider your complaint. Other criteria must also be met. Call: Fax: (04) info@ifso.nz Write to: Insurance & Financial Services Ombudsman Scheme PO Box Wellington 6143 The IFSO will not charge a fee to any complainant to investigate or resolve a complaint. THE SUPERVISOR You can also make a complaint to Public Trust: Call: during normal business hours. Write to: General Manager Corporate Trustee Services Public Trust PO Box 5067 Wellington 6145 Public Trust is a member of an approved dispute resolution scheme operated by Financial Services Complaints Limited (FSCL). If your complaint to Public Trust has not been resolved you can refer it to FSCL. Call: Write to: Financial Services Complaints Limited 4th Floor, 101 Lambton Quay PO Box 5967 Wellington 6145 FSCL will not charge a fee to any complainant to investigate or resolve a complaint

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16 Kiwi Wealth KiwiSaver Scheme.