The Association of Superannuation Funds of Australia (ASFA) says that while delivering the best retirement outcomes for fund members is the top priority, care should be taken in implementing the recommendations made by the APRA Capability Review panel, to avoid long term risks, costs and poorer outcomes for superannuation members.
“The recommendations to raise capability and deploy a more effective operating model for APRA have considerable merit but the superannuation specific recommendations need careful consideration,” said ASFA CEO Dr Martin Fahy.
A significant change is proposed to the long-standing focus of APRA, from prudential stability and systemic risk to member outcomes. This implies material changes to the overall regulatory architecture, which if not implemented properly may ultimately not be in the best interests of members.
“Achieving sound investment performance and broader member outcomes is a long-term journey, measured in terms of decades, against objectives set by the trustees that solve to the needs of their member base.
“Simplistic approaches to assessing member outcomes, such as reliance on league tables of short-term fund performance, reduce the efficacy of the superannuation system and go against the interests of fund members.”
ASFA considers it critical that the regulators are funded to a level that is appropriate to enable them to fulfil their regulatory functions, while balancing the impost on industry and, indirectly, on members.
Along with trustees and funds being held accountable, it is important that APRA provides an appropriate level of transparency to all stakeholders—including the Government, industry participants and fund members—as to their utilisation of allocated funding and resources.
For further information and media inquiries, please contact:
Mia Kwok, 0451 949 300.
ASFA is the peak policy, research and advocacy body for Australia’s superannuation industry. It is a not-for-profit, sector-neutral, and non-party political, national organisation. ASFA’s mission is to continuously improve the superannuation system, so all Australians can enjoy a comfortable and dignified retirement.