BUSSQ lowers administration fees

BUSSQ MySuper and Premium Choice account holders will see lower administration fees, however their insurance costs will rise from July 1.

The $7 billion super fund will no longer charge members a weekly administration fee of $1.75 ($91 per year) and will reduce the percentage-based administration fee from 0.20% to 0.18% per year.

Prior to July 1, members with an account balance of $50,000 would have been charged, or have deducted, $100 in administration fees and costs of up to a maximum of $1000 per year, plus $91 regardless of the account balance.

After the change, a member with $50,000 in their account will be charged, or have deducted, $91 in administration fees and costs up to a maximum of $1000 a year.

This means someone with a balance of $25,000 would save around $96 per year, someone with $500,000 would save $191 per year and someone with a $1 million balance would save $91 per year.

In addition, the fund will remove the insurance administration fee, which prior to July 1 is charged at 6% of the gross insurance premium.

However, BUSSQ will also remove the direct tax rebate on insurance premiums, which it said would reduce the amount of tax paid by the fund, but the benefit of this will no longer be paid to members.

"Currently, BUSSQ passes the benefit of this tax deduction on to insured members in the form of reduced premiums. From 1 July 2025, the benefit of any tax deduction available to the fund will be paid into the Administration Reserve and not passed directly back to members through reduced premiums," the fund said.

"The purpose of the Administration Reserve is to fund the operations of BUSSQ and is used to support the delivery of products and services to members."

As a result, all members will see premiums for their death and TPD cover rise.

For example, a manual worker with the default four units of both cover types will see their collective premiums increase by more than $60 per year. A non-manual worker with the same cover will see theirs rise by more than $25 a year.