APRA: We don’t make policy
The Australian Prudential Regulation Authority (APRA) has insisted that it does not get involved in political policy-making and is watchful of superannuation funds that do.
Amid the continuing debate over the use of superannuation for home ownership, the regulator sought to distance itself from the politics of the issue.
“Policy changes to broaden the role of superannuation beyond providing for members in retirement to achieve other objectives, such as facilitating home ownership, are outside of APRA’s mandate and are a matter for Government,” APRA told NSW Labor Senator, Tony Sheldon.
Sheldon had asked whether APRA believed it should have a role in determining what policy funds should or should not support.
“Does APRA believe it should have a role in determining whether or not funds should communicate or take public positions on policies?” he asked during a Senate Estimates hearing.
“In the first instance it is a matter for trustees to determine whether engaging on matters of policy is consistent with their obligations under prudential standards and the Superannuation Industry (Supervision) Act 1993,” APRA said.
“Compliance with these obligations is determined on a case-by-case basis. If APRA has concerns about the actions of a trustee in relation to its engagement on a matter of policy it will make further inquiries to determine whether a trustee has acted in accordance with its obligations taking into consideration the circumstances of the case.”
“Educating members on matters of policy is beyond APRA’s current mandate. Decisions about extending APRA’s mandate are a matter for Government.”
While confirming that it publishes notes from its roundtable meetings with superannuation fund chief executives, it said details of those discussion were protected information under section 56 of the Australian Prudential Regulation Authority Act.
The old “I was just following orders” defense!
Looks to me like APRA have just greenlighted massive spending by industry funds on political advertising in the upcoming election.
Then change the legislation.
One area that seems cherry ripe for change is the look-in of investments and testing best interest duty.
As I understand it, contentious areas (for example, a media publication that lost money year after year that was previously owned by super funds) was not able to be examined in detail by APRA because is considered an investment and not trustee spending. (If I have this wrong, please let me know).
If correct, that’s really not good enough.
As to Trustee spending transparency and accountability – this too appears to be very wanting in my opinion.
This idea of, oh “but it was within the rules” is also not good enough. A lot of the stuff we’re reading lately in this space surely doesn’t pass the pub test.
Perhaps it’s the members that should get to have a say rather than being forced to leave if they don’t like it.
Perhaps it’s the members that should have the power to remove board members (or entire boards) of their super fund.
Just like ASX companies….