AIST welcomes APRA’s spotlight on super fund performance, fees and sustainability

Australian Institute of Superannuation Trustees

The Australian Institute of Superannuation Trustees (AIST) welcomes today’s release of APRA’s heatmap data, noting we have long called for the regulator to collect and publish data on fund performance across the superannuation sector.

AIST CEO Eva Scheerlinck said the heatmap was an important first step in providing independent data on super fund performance but more work needed to be done to improve the regulator’s analysis and extend it to all APRA-regulated funds.

The heatmap shows that – across the $654 billion profit-to-member MySuper sector – more than 9 out of every 10 dollars of members’ super* is invested in well-performing products.

“This first go at the heatmap confirms what the Productivity Commission found – that the overwhelming majority of members’ super in the profit-to-member MySuper space is invested in well-performing funds”.

Ms Scheerlinck said underperforming funds would need to actively work with APRA to address any concerns.

“In a compulsory super system, it’s vital that all members are in long-term, strong performing funds. Given that the heatmap is not intended for consumer use, there is also a need for a consumer-friendly tool so members can make informed decisions about which fund is best for them.”

Ms Scheerlinck said AIST looked forward to the extension of the heatmap to the Choice (non-MySuper sector) where underperformance is a much bigger problem. Currently, the heatmap only applies to MySuper products and not the larger Choice sector where there is more than $1 trillion of members’ savings.

“We have to keep in mind that as a sector, MySuper outperforms all other APRA funds. As it stands now, the heatmap is no help to the millions of consumers who are languishing in dud funds outside of the MySuper space.”

*more than 90% of the $654 billion invested in profit-to-member MySuper products showed no underperformance on APRA’s heatmap

/Public Release.