The Australian Prudential Regulation Authority (APRA) has released the results of its inaugural superannuation fund performance test, revealing that 13 out of 76 products failed the test.
Executive Board Member of APRA, Margaret Cole said the MySuper Product Performance Test assessed 76 MySuper products with at least five years of performance history against an objective benchmark.
“It is welcome news that more than 84 per cent of products passed the performance test, however, APRA remains concerned about those members in products that failed,” Ms Cole said.
“Trustees of the 13 products that failed the test now face an important choice: They can urgently make the improvements needed to ensure they pass next year’s test or start planning to transfer their members to a fund that can deliver better outcomes for them,” she said.
“APRA has intensified its supervision of trustees with products that failed the test and has requested they provide a report identifying the causes of their underperformance and how they plan to address them.”
Ms Cole said Trustees had to monitor their products closely and report important information to APRA, including information related to the movement of members and outflow of funds.
The Executive Board Member said Trustees of failed products were required to write to members by 27 September to advise them of their Performance Test outcome and provide the details of the Australian Taxation Office’s YourSuper comparison tool.
“As well as scrutinising the plans of the 13 funds that failed the test, APRA is engaging with trustees at risk of failing the performance test next year to ensure they take the steps necessary to improve performance and to understand their contingency plans,” Ms Cole said.
A list of the 13 super fund products that failed APRA’s Performance Test can be accessed at this PS News link and details of the Authority’s Test results at this link.
