Motor Ace

Australia’s top super fund manager isn’t headquartered high up in one of the ritzy glass towers of Sydney or Melbourne – he works in a three-storey building just down Brisbane Avenue from Parliament House, Canberra.
MTAA Superannuation, the motor trades’ industry super fund, tops the performance tables on one, three and five year measurements – and all on a management expense ratio targeted this year to be just 0.73 per cent. Funds under management jumped by 37 per cent last year to $3.1 billion.

It’s a track record that is being recognised by canny investors taking advantage of MTAA being a public offer fund. Of the present 250,000 members, 20,000 are private investors outside the motor trades and about 10 per cent of those are from Canberra – public servants tipped off by local word-of-mouth.

MTAA Super’s principal executive officer – and executive director of the Motor Trades Association of Australia – Michael Delaney is happy to see investors attracted to the fund and willingly shares the secret of the MTAA’s success: some 43 per cent of the fund is invested infrastructure and private equity.

The MTAA model is closer to that used by the foundation funds of the great American universities than the usual Aussie super fund. Part of the key is that MTAA Super doesn’t shop retail. It’s not even content with wholesale these days, increasingly wanting a seat at the manufacturing table.

That sees it owning assets as varied as Canberra office buildings and the Port of Gdansk.

The accompanying video interview provides a taste of the MTAA’s methods, while the transcript of the longer interview gives some flavour of why the MTAA team is working so successfully as a mutual. There’s also some strong beliefs about hedge funds – wouldn’t touch 'em – and Sydney’s controversial cross-city tunnel - Michael Delaney says the traffic projections don’t add up.

The transcript and audio of this interview will be available on Monday (17 Oct 05).