Comparison tool targets underperforming super funds

By Melissa Coade

Wednesday September 1, 2021

Treasurer Josh Frydenberg says Australia needs to be part of international commitments for greenhouse gas emissions to be cut to net zero by 2050. 
Treasurer Josh Frydenberg says Australia needs to be part of international commitments for greenhouse gas emissions to be cut to net zero by 2050.  (AAP Image/Lukas Coch)

The results of the Australian government’s YourSuper annual comparison tool were published for the first time on Tuesday, and revealed $56.2 billion had been invested in underperforming superannuation products.

Funds that have failed the government’s test will be required to notify their members of underperformance by 27 September, and provide members with details of the comparison tool so they can consider another product.

In a joint statement treasurer Josh Frydenberg and minister for superannuation, financial services and digital economy Jane Hume, said the government was focused on ‘holding underperforming funds to account’ and improving protections for the retirement savings of Australians.

The tool offered superannuation members access to a trusted and independent source to compare produce performance, the statement said. 

“Importantly, eight products have exited the market since the performance test was announced by the Government, demonstrating that the positive impact of the test extends beyond singling out underperforming funds,” according to the statement.

The Australian Prudential Regulation Authority (APRA) will be contacting superannuation funds whose products fail or marginally pass the performance test, with an outline of the authority’s  supervisory expectations. One of APRA’s powers will be to assess the credibility of plans that super funds devise to improve their performance. 

“Products that fail the annual performance test again next year will be closed to new members until their performance improves,” the statement read.

The federal government estimates that reforms to the Your Super system will save workers $17.9 billion over 10 years, and says it is committed to making the system ‘work harder’ by improving transparency and accountability of return.

MySuper product performance outcomes can be viewed online via the comparison tool.


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