Scrutiny intensifies on YFYS tests

The spotlight on superannuation performance tests will “only get more intense”, according to Australian Prudential Regulation Authority (APRA) member Margaret Cole.

In a speech at the Australian Institute of Superannuation Trustees (AIST) conference in Queensland, Cole said the Government had begun a review of Your Future, Your Super laws.

Five funds failed the latest iteration of the YFYS performance test last week.

“We always want to get smarter and better and the consultation process will give industry the opportunity to have a say as to what a future evolution of the Your Future Your Super reforms could include. So, from an APRA perspective, a review after two cycles of the test makes good sense. 

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“But the Assistant Treasurer has also been very clear that funds must always be held accountable for their performance, so we expect performance testing, in some shape or form, is here to stay. And for our part, we have seen the benefits that greater transparency on performance brings, so regardless of the exact form of the statutory test, the spotlight will only get more intense.”

She also welcomed steps taken by certain funds to reconsider their spending and expenditure and whether it would benefit their members and called for all funds to examine this.

The future of a competitive super industry, Cole said, would depend on trustees being able to identify opportunities for growth and innovation and prioritising the interests of members with clear propositions and a member-centric service approach.