The Association of Superannuation Funds of Australia (ASFA) has called for greater transparency around proposed increases to financial institution supervisory levies, warning the rising regulatory costs will ultimately be passed on to superannuation fund members.
In a submission to Treasury on the proposed Financial Institutions Supervisory Levies (FISLs) for 2026–27, ASFA said the superannuation sector’s total levy bill is set to rise to $125.2 million, up $12.7 million from $112.5 million in 2025–26.
While supporting the principle that regulated entities should contribute to the cost of regulation, ASFA argued regulators must provide clearer justification for funding increases and greater accountability over how levy revenue is spent.
“With respect to transparency and equity, while the discussion paper for the proposed Financial Institutions Supervisory Levies (FISLs) for 2026-27 provides more information about high-level regulatory activities compared with previous years, it does not provide sufficient detail for industry to adequately understand how levies are determined – including the proposed rise in levies for 2026-27,” ASFA said.
The industry body noted that levies are ultimately funded through administration fees charged to members and said the impact is likely to be felt more acutely by members of smaller funds.
According to ASFA’s estimates, the combined cost of FISLs and ASIC levies for the superannuation sector is likely to reach around $155 million in 2026–27.
Based on the assumption that costs are distributed across member accounts on a pro-rata basis, ASFA estimated the average MySuper member would effectively bear around $7 of the combined levy burden.
The impact could range from about $5 per member in a $100 billion fund to around $13 per member in a $1 billion fund.
A significant portion of the proposed increase stems from higher APRA costs. The APRA component of the levy is expected to rise from $72.9 million in 2025–26 to $81.2 million in 2026–27, including recovery of $0.8 million in under-collected levies from the previous year.
ASFA noted the APRA component for the superannuation sector has increased by $50.7 million, or 166 per cent, over the past decade, compared with CPI growth of 35 per cent over the same period.
It said the available data suggested APRA’s regulatory costs for superannuation were increasing at a faster rate than for other parts of the financial system.
“For APRA, the 2026-27 FISLs Paper shows a large increase in the relevant levy component – in respect of the superannuation sector – from $72.9 million in 2025-26 to $81.2 million for 2026-27,” the submission said.
The ATO component is also expected to increase, rising from $37.2 million in 2025–26 to $41.6 million in 2026–27.
Costs associated with the Superannuation Lost Member Register, Unclaimed Superannuation Money frameworks and the Compassionate Release of Super program continue to be fully recovered through the levy system.
Although ASFA backed efforts to reunite Australians with lost and unclaimed superannuation, it said the ATO should publish assessments of the effectiveness of those programs and provide greater transparency around flows of lost and unclaimed money.
The submission also raised concerns about the structure of the proposed levy increases as the Treasury’s paper proposes a 9.6 per cent increase in the restricted component levy rate and a 5.0 per cent increase in the unrestricted component rate.
According to ASFA, a fund with $100 billion in assets would see levies rise by around 6 per cent, while a $20 billion fund would face an increase of about 9 per cent.
Referencing earlier Productivity Commission analysis, ASFA warned that excessive reliance on industry levies could create barriers to entry and weaken competition across the superannuation sector if not carefully designed.
