TTS is a better Smart Default implementable by superannuation trustees.
At the start of 2019, the Productivity Commission found well-designed life-cycle defaults (such as TTS) can produce benefits greater than single strategy balanced defaults and also manage sequencing risk as retirement approaches, while better matching diverse member needs.
The Royal Commission also confirmed a trustee cannot avoid its obligations by doing nothing, they must act to improve members’ outcomes.
Funds are now running the audit-able TTS Reports, member by member as their framework for the new Outcomes Test. Those Reports show a consistent 35+% higher average projected retirement balance, with a lower average amount of sequencing risk.
In 2018, TSS presented to the Productivity Commission hearings and made detailed submissions.
In 2017 beta testing was completed and submissions made to government and regulators. The Financial Services Council and TSS issued the Innovation in Superannuation – Smart MySuper Default Report highlighting the need for TTS.
During 2016 Tailored Superannuation Solutions (TSS) was incorporated and established, the Productivity Commission undertook reviews into MySuper efficiency, with numerous submissions and recommendations made in support of Smart Defaults like TTS.
During 2015/16 all the directors were on the TTS Advisory Board and the TTS implementation blueprint by a major international consulting firm was completed, along with the TTS App.
Following submissions, the 2015 FSI report and recommendations included numerous elements supportive of TTS introduction that were adopted by Government. Those matters included the legislating of the purpose of Super as retirement focused, the inclusion on annual member statements of projected retirement balances, plus a focus on more innovation in this sector.
In addition the Centre for International Finance and Regulation (CIFR) Default Funds Industry Research and Survey was released. It supports the introduction of Smart Defaults, such as TTS.
Over the previous 6 years, research was undertaken, the government lobbied and supportive MySuper regulations introduced, submissions to government and industry forums made and in 2010 an Australian standard 20 year patent was granted and sealed for TTS.