Understanding the Impact of APRA Performance Tests on Members

It’s essential to stay informed about regulatory changes that affect our financial future. One such development that demands attention is the introduction of performance tests by the Australian Prudential Regulation Authority (APRA). Here’s what this means for you:

  • Increased Accountability: APRA performance tests aim to hold super funds accountable for delivering values to members. By evaluating funds based on factors like investment returns and fees, these tests provide transparency and empowering members to make informed decisions about their super.
  • Focus on Outcomes: The focus is shifted from simply comparing fund features to assessing the actual outcomes achieved for members. It’s not just about low fees or impressive marketing; it’s about delivering tangible benefits and helping members to achieve their retirement goals.
  • Improved Competition: By benchmarking funds’ performance against peers, APRA tests promote healthy competition within the super industry. Funds are incentivised to strive for excellence, leading to improved services, lower fees, and better outcomes for members.
  • Member Empowerment: Most importantly, these tests put the power back into the hands of members. By providing clear and standardised information about the fund performance, members can make more informed decisions about where to invest their hard-earned money.
  • Potential Implications: While the introduction of performance tests is undoubtedly a positive step towards greater transparency and accountability, it may lead to some funds underperforming or facing increased scrutiny. Members should stay vigilant and use the information provided by these tests to assess whether their fund is delivering value for money.

In conclusion, the APRA performance tests represent a significant milestone in the ongoing evolution of Australia’s superannuation industry. By promoting transparency, accountability, and competition, these tests will provide benefits across the board. As we navigate through these changes, let’s remain proactive in understanding our super options and advocating for our financial interests.



Daniel Bartlett works on a wide range of superannuation, insurance and wealth management assignments at McGing Advisory & Actuarial.