Australia's superannuation sector faces declining service standards

The superannuation sector in Australia is consolidating, with the number of industry funds dropping from 40 in 2017 to 21 now. The latest merger involves CareSuper and the Meat Industry Employees’ Superannuation Fund, creating a larger fund amid declining service standards. As funds grow, service issues have emerged, particularly with delayed death benefit payouts. AustralianSuper and Cbus are facing allegations from the financial regulator ASIC for significant delays in processing claims, raising concerns about the efficiency of these large funds. The consolidation has led to fewer funds competing, which may impact service quality as the industry shifts focus from accumulating assets to paying out benefits. The situation highlights the challenges of maintaining service standards in a shrinking competitive landscape.