Record inflow into superannuation in 2022: APRA stats

Australians put more than ever into superannuation last year, on the back of strong employment and a higher super guarantee levy.

The superannuation system paid out a near record $92bn to beneficiaries in 2022.

Australians contributed a record $154bn in superannuation last year, up by almost 12 per cent, on the back of a strong employment picture and the increase in the superannuation guarantee levy, according to new statistics from the Australian Prudential Regulation Authority (APRA).

At the same time, the superannuation system paid out a near record $92bn for the year to beneficiaries, a figure only exceeded by the record $113bn paid out in benefits in 2020 when normal outflows were boosted by $36bn in early access payments allowed because of Covid.

The latest statistics from APRA show the total amount of money in superannuation by the end of December last year was $3.37 trillion.

While this was down by 3 per cent over the $3.49 trillion at the end of December 2021, because of falls in investment markets, the big fall was over by the December quarter, when the value of super assets rose by 2.5 per cent.

The APRA figures show the increase in the superannuation guarantee levy to 10.5 per cent last July helped to drive an 11.8 per cent increase in employer contributions to $115bn over the year, with additional contributions by members going up by 8.6 per cent over the year to just under $40bn.

Industry analysts compared the year to the last big surge in super fund contributions under the Howard-Costello government when there was a one-off opportunity in the 2006-7 financial year for people to make an extra $1m in contribution to their super.

The chief executive of the Association of Superannuation Funds of Australia, Martin Fahy, said the figures showed that personal contributions to superannuation remained “above historical trends.”

He said this showed that “Australians continued to have confidence in superannuation as a retirement savings vehicle”.

He said the statistics showed that both contributions and benefit payments were up by around 11 per cent over the year.

“The increase in the superannuation guarantee to 10.5 per cent from July 1, 2022 was an important factor, but employment growth and increased voluntary contributions also would have had an impact,” he said.

APRA said the 11.3 per cent increase in the payment of benefits – which included a 17.6 per cent increase in lump sum payments to $50.2bn and a 4.5 per cent increase in pension payments to $41.3bn was in line with long-term trends as the superannuation system was maturing and the Australian population was ageing.

Net contribution flows to the super sector were up by 9.1 per cent to a record $64bn, up from $58.7bn in 2021.

The year saw a cut back in the number of funds offering MySuper products from 61 to 52, reflecting the ongoing consolidation in the industry.

The year saw a $3.3bn net outflow from APRA regulated super funds to self managed super funds which APRA said was “broadly in line with recent trends.”

Total assets in self managed super funds were down over the year from $902bn at the end of December 2021, to $880.6bn at the end of December 2022, largely as a result of market falls over the year.

Originally published as Record inflow into superannuation in 2022: APRA stats