Government Superannuation Fund · New Zealand · NZ$5.8B
This fund does not employ a single investor
The New Zealand Government Superannuation Fund is NZ$5.8 billion, closed to new members and paying out roughly NZ$25 million a month. It has no investment staff. It co-owns a 15-person company, half and half with another small government fund, which supplies its entire executive team and bills at cost with no margin. It then pays an outside firm to price that arrangement against global peers each year, and publishes the result even when it fails.
Key numbers, and what they mean
15
People at Annuitas, the company that supplies the fund's entire executive team. The fund itself employs nobody. It owns half of Annuitas and another government fund owns the other half.
At cost
How Annuitas is paid: reimbursement calculated on a time basis. No fee on assets, no performance fee, no margin. The people who run the fund do not get richer as the fund grows.
6.1 bps
How far above the global peer median its investment costs ran in the latest independent benchmark. Its own published standard is within 5 basis points of the median, so it recorded the result as not achieved.
6 vs 55 bps
What the fund's own overheads are budgeted to cost, against what external managers are budgeted to cost. The governance layer is cheap. The manager layer is where the money goes.
Budgeted cost, 2026-27
External manager base fees0.39%
Performance fees0.16%
Authority overheads0.06%
Custody0.02%
Forecast, from the fund's own statement of performance expectations. Running the whole Authority, shared executive team included, is the second smallest line on the page.
The read-through
From the report
Takeaway: how to apply it to a portfolio
Annuitas is owned half by this fund and half by another government fund, and is reimbursed on a time basis rather than on assets.
The real question is not whether to build a team or outsource one, it is who owns the economics. An outsourced chief investment officer priced in basis points gets richer as your assets grow, whether or not the work grows. A team you co-own and pay by the hour does not.
Its policy sets a hard cost standard, within 5 basis points of the peer median as measured by an independent benchmarking firm, and it reported the latest result as not achieved at 6.1 basis points above.
An arrangement you cannot grade is one you cannot fire. Commit in writing, before you hire, to an annual independent cost benchmark, define the pass mark in basis points, and send the result to the whole committee. Missing by 1.1 basis points in public is a higher standard than most family offices hold themselves to.
The fund's own overheads are budgeted at about 6 basis points against about 55 for external managers, and it was manager performance fees rather than the cost of running the fund that pushed it over its cost target.
Your costs are almost never in the governance layer. Paying more for better oversight in order to pay less to managers is usually the right trade, but only if you measure the whole stack, because the expensive layer is the one being overseen.
The Argus lensWhat pushed this fund over its own cost target was performance fees paid to external managers, not the cost of running it. Knowing what a manager actually charges, on what base and above what hurdle, is a documents question. Answering it is what we do.
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About the source
The Government Superannuation Fund Authority's annual report for the year to 30 June 2025 gives the NZ$5.84 billion fund value, the returns, the 15-person headcount at Annuitas and the cost benchmarking result. The ownership of Annuitas and the reasoning behind it are from its statement of intent for 2026 to 2030, and the budgeted cost breakdown from its statement of performance expectations for 2026. This is a closed defined-benefit scheme and a different entity from the much larger New Zealand Superannuation Fund.