The superannuation industry is experiencing increasing structural change warranting closer attention on the part of the Australian Prudential Regulation Authority (APRA).
APRA has used its annual report tabled in Parliament to point to the gradual decline in net contributions reflecting Australia’s ageing population.
“This reflects Australia’s ageing population and the maturing of the superannuation system, as a growing number of members reach retirement age and begin to draw down on superannuation assets,” the regulator’s annual report said.
“This is slowly removing one of the superannuation industry’s two primary sources of growth [positive net contributions] and poses a structural challenge to funds’ ability to maintain and gain scale,” it said.
Amid a challenging market environment, three super fund CIOs have warned against ‘jumping at shadows’.
The professional body is calling for the annual performance test to transition to a two-metric test, so it better aligns with the overarching duty of super fund trustees to act in the best financial interests of their members.
AustralianSuper, Rest, and HESTA agree on the need to retain and enhance the test, yet they differ in their perspectives on the specific areas that warrant further refinement.
Australia’s second-largest super fund has confirmed it is expanding its presence in the UK following significant investment in the region.
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