Regulators push trustees to improve lagging retirement strategies

ASIC and APRA have warned many trustees have failed to meaningfully improve retirement strategies despite the retirement income covenant being in place for three years.

ASIC and APRA have urged superannuation trustees to accelerate their work on retirement income strategies, warning that progress has stalled for much of the industry since the Retirement Income Covenant (RIC) began in July 2022.

Releasing the 2025 RIC Pulse Check report, the regulators said a widening divide has emerged between funds that have built robust approaches to supporting members in retirement and those that have only made modest updates.

While some trustees have invested heavily in new tools, guidance and product development, others have not moved beyond basic, incremental changes, according to the regulators.

The report calls on all trustees to lift their focus on retirement outcomes and work towards the better-practice expectations set out by the regulators.

ASIC commissioner Simone Constant said millions of Australians either already in retirement or approaching it are entitled to more ambitious efforts from their funds.

“Super trustees have had three years to develop meaningful retirement income strategies that meet the diverse needs of their members – and meet the law,’ she said, noting retirees have entrusted nearly $600 billion in savings to super funds.

She added the need for well-designed strategies will intensify as the population ages, with two in five trustees expected to have most of their members retired by 2045.

APRA deputy chair Margaret Cole said both regulators remain focused on ensuring funds deliver a better experience for people preparing for and living in retirement, consistent with the intent of the RIC.

ASIC and APRA confirmed they will provide tailored feedback to individual trustees as part of efforts to lift standards across the sector.