New heatmaps being developed by APRA will make it easier for consumers to identify underperforming super products, but must be applied consistently across all sectors Industry Super Australia says.
Industry Super Australia Chief Executive Bernie Dean today welcomed APRA’s outline of the new heatmap system, in line with industry super funds’ longstanding position that underperformance must be dealt with.
The new heatmaps are an important first step that will help consumers compare apples with apples when it comes to performance, fees and sustainability.
With the chronic underperformance of some funds costing members hundreds of thousands of dollars in super by the time they retire, it is critical that the heatmaps, and any other performance focused tool, focus not just on the MySuper sector – but be applied with equal rigour across the system to the Choice sector.
This is because underperformance is not limited to just MySuper products – in fact, it is more prevalent in the Choice sector.
As APRA continues to refine this tool, Industry Super Australia looks forward to working with the regulator to ensure key measures like benchmarks and net returns are front and centre – as this is also critical to making sure members have all of the information they need to compare and identify underperforming funds.
With too many Australians still stuck in underperforming super funds, the focus of the Government, regulator and the superannuation sector must be on ensuring members are connected to a single, quality-checked and high performing fund with low fees and good returns.
Tools such as APRA’s new heatmaps will provide an important bottom-up approach to tackling underperformance, rather than a top-down approach.