The superannuation industry should not wait for legislative change to implement the Hayne Royal Commission recommendations to improve their practices.
These were the words of Australian Prudential Regulation Authority (APRA) Deputy Chair, Helen Rowell, at the Australian Institute of Superannuation Trustees Conference.
The superannuation industry came under heavy criticism during the Royal Commission. Since then, discussions have evolved around insurance in superannuation, fees-for-no-service, and slow the pace of remediation for clients who had some challenges. APRA is also looking at creating greater transparency in the superannuation space.
“Commissioner Hayne identified areas where APRA must clearly do better—especially in relation to ensuring trustees are held to account for failing to meet their obligations to members,” Rowell said.
Rowell said that, soon, she would be sending out a letter to registrable superannuation entities (RSEs) about APRA’s focus when it comes to monitoring and regulation. The primary call will be on trustees to ‘put members’ interest first’.
One area where APRA intends to improve processes is in the collection of superannuation data and the collection of My Super data. Rowell indicated that analysing these will help APRA identify underperforming funds.
“We acknowledge that sourcing and delivering this additional data might present a regulatory burden for trustees, but it is essential to restore confidence in the industry and for APRA to do its job. Where obstacles arise, we expect industry to help us find solutions rather than just telling us that something can’t be done,” Rowell said.
Rowell referred to the Member’s Outcomes Bill, which is yet to pass Parliament but which will give the prudential regulator the power to initiate civil penalties for actions that breach obligations to members. This legislation was first introduced to Parliament in 2017, prior to the commencement of the Hayne Royal Commission.