The Government has confirmed it is moving ahead with progressing the Retirement Income Covenant which was deferred last year to 1 July, 2022.
Speaking at the Conference of Major Superannuation Funds (CMSF), Minister for Superannuation, Financial Services, and the Digital Economy and Minister for Women’s Economic Security, Jane Hume, said the purpose of the retirement income system was to provide income in retirement and smooth consumption between working life and retirement.
Hume said the covenant would require trustees to have a strategy to generate higher retirement incomes for members.
“The covenant allows super funds the flexibility to tailor their retirement income strategy to their specific membership base, while also allowing them to deliver solutions they think will work best for the particular cohorts of members in their fund,” she said.
“Once we pass the Your Future, Your Super reforms, this is the next cab off the rank.”
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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