The capability review of the Australian Prudential Regulation Authority (APRA) led by former Australian Competition and Consumer Commission (ACCC) chair, Graeme Samuel has delivered what was broadly expected by recommending measures which would toughen-up the regulator’s approach.
The Treasurer, Josh Frydenberg, commissioned the review in early February and selectively released its final report on Tuesday which revealed a view that APRA should have a greater ability to object to the appointment of directors and executives to the financial institutions it regulates if it believes they are inappropriate.
And at a time when APRA is locked in litigation with IOOF over matters arising from the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, the capability review questioned the manner in which the regulator handled the resolution of prudential matters – specifically citing “protracted behind the scenes negotiations of prudential issues”.
The Treasurer signalled the Government’s preparedness to act on the report’s recommendations – something which may lead to a strengthening of the Bank Executive Accountability Regime, which is already ear-marked for expansion to other areas of the financial services.
APRA’s formal response to the capability review said: "APRA will engage with the government on how the objectives identified by the capability review can best be achieved, noting the potential for moral hazard and administrative burden”.
There is a need for Australia’s superannuation funds to simplify their investment menus, according to the firm, given over a third of funds have more than 30 options, of which one or more are “arguably subscale”.
The research house is set to offer research ratings of superannuation funds for the first time amid growing demand from financial advisers.
Treasury is calling for submissions on its draft regulations in relation to the calculation of the proposed Division 296 tax.
Initially intended to offer a “simple, cost-effective” option for Aussies invested in default fund options, a super consultant has weighed in on what the scheme has actually done for members.
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