APRA warned on member outcome costs

The Australian Prudential Regulation Authority (APRA) has been warned that its new member outcomes regime will deliver both increased costs and unintended consequences for superannuation funds.

In a submission filed with APRA, the Association of Superannuation Funds of Australia has reinforced its earlier misgivings about the member outcomes regime and warned that the proposals, especially those relating to the new member outcomes assessments and the additional reporting requirements, “will add to the cost and reporting burden which super funds already bear”.

“… and we are not convinced that the desired benefits will eventuate,” the superannuation group said.

Related News:

“In general, ASFA is cautious about any reforms which add to the regulatory or reporting burden for its members without a clear purpose or benefit first being established,” the submission said. “We can see merit in the spirit of some of the proposed reforms, however we have reservations about the impact on resources that proposals like the outcomes assessments will present for RSE licensees.”

“While we appreciate the intent behind the outcomes assessment proposals we are concerned that it will become primarily an additional and substantial compliance exercise. We question whether APRA could achieve the same result with its existing regulatory and supervisory powers without imposing a blanket requirement on all RSE licensees,” it said.

“We are also concerned that the prescription in the strategic objectives and business planning doesn’t recognise the flexibility required by a modern commercial business and that the general effect of the proposals may be to make RSE licensees more cautious and risk-averse in their strategic business planning and objective setting, or to treat risk as a primary consideration.”




Related Content

Budget SG change helps board directors

Superannuation fund and public company directors who receive fees from multiple sources may be amongst those best placed to take advantage of the Gove...Read more

Have superannuation savings for women improved?

While the average superannuation balances of intending retirees over the last decade have doubled for both genders, women’s averages remain well beh...Read more

Has the PC report already passed its use-by date?

The political cycle and the Royal Commission indicate that the Productivity Commission’s recommendations on the efficiency and competitiveness of th...Read more

Author

Comments

Add new comment