YFYS

The CEO of AustralianSuper says the Morrison Government doesn’t get enough credit for introducing the YFYS reforms, and that funds need to stop arguing over its detail and get on with the business of performing against the benchmarks.

Adding a qualitative measure of performance or the right to appeal to YFYS could enhance consumer outcomes. But critics have warned that it could defang the test.

The Grattan Institute says that “maintaining the integrity” of the performance test is vital and that the review should seek to make incremental improvements rather than wholesale reforms.

Passing the performance test is no excuse for not merging, according to APRA, and the prudential regulator will still be giving small funds the nudge to consolidate where they feel their size isn’t sustainable.

A new review will address some of the unintended consequences of Your Future Your Super. But while super funds are no doubt holding out for a hero, there’s probably no perfect performance test.

The prudential regulator’s superannuation czar says it has no view on whether smaller funds can survive – but that funds must continue to innovate to avoid becoming “footnotes in financial history”.

As homegrown competition intensifies and offshore players eye Australia’s retirement savings, the industry funds are now “frenemies”. Reinvigorating the collaborative model will be the key to their survival.

Labor and the superannuation industry are still running their victory lap, but concerns around disclosure and consolidation loom large in the background.

It’s unlikely that there will be an increasing trend towards Your Future Your Super (YFYS) test failures, but the unintended consequences of the reforms are still worth examining, says JANA.

Fewer funds failed the Your Future Your Super (YFYS) test than last year – but plenty of passes have come from managing to the constraints of that test.