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Super fund executives face annual attestations

Mike Taylor4 July 2024
Finger pushes standards

The Australian Prudential Regulation Authority (APRA) has placed superannuation fund trustees and executives under new, stronger strictures around proving expenditures are in the best interests of members.

The regulator has strengthened Prudential Standard 515 and related guidance in a move which it says will ensure members’ interests are front and centre in trustees’ strategic and business planning, financial resource management, implementation of the retirement income covenant and fund transfers.

Importantly, the changes will oblige super fund executives to actually attest that the fund’s expenditure align with members’ best interests.

Commenting on the changes, APRA deputy chair, Margaret Cole said the regulator was setting a clear expectation for trustees to put members front of mind in every decision they make.

“Fund expenditure is a significant area of focus for APRA and the broader community. In addition to tightening the obligations under SPS 515, APRA is now collecting, analysing and will be publishing detailed expenditure data at a fund level. APRA will review the data to ensure spending aligns with the best financial interests of members, and will follow up trustees with outlying discretionary expenditure.

“The industry will face further scrutiny on spending when the Financial Accountability Regime comes into effect for superannuation next March, with trustees required to identify an accountable person with responsibility for expenditure.

“Another important change to SPS 515 is the requirement to support the implementation of the retirement income covenant. It’s estimated that more than three million fund members will reach superannuation preservation age in the next decade making it critical that funds have robust and effective strategies to assist members who are approaching or in retirement,” Cole said.

Prudential Standard SPS 515 Strategic Planning and Member Outcomes (SPS 515) will take effect from 1 July 2025.

Mike Taylor

Mike Taylor

Managing Editor/Publisher, Financial Newswire

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Never Busted Industry Super
12 days ago

Yeh yeh as APRA, ASIC and the Industry Super Funds Execs charged their glasses up to each other in the Industry Fund Corporate Sporting Boxes.
They all giggled like teenage kids and agreed to another media statement to show things are managed properly, strongly.

But in Reality APRA, ASIC and Industry Super are the worst case of REGULATORY CAPTURE CORRUPTION.
And APRA & ASIC will do NOTHING to stop Industry Super making massive ALP donations, Living large in Sporting Corporate boxes and Union Reps managing related Super businesses to skim $$$$$$ SQUILLION out of the Super System to feed themselves.

Ken
12 days ago

I hope this covers Union payments for whatever they give it to them for ??

Uber Qualified Adviser
12 days ago

There needs to be a Royal Commission into the relationship between Industry Funds, the ISN and Labor.
At this point, best interest duty would dictate that I do not advise clients into Industry Funds.
It’s just too opaque.

Sometimes you have to ask is this for real
12 days ago

Such an RC wont occur until a change of Govt

Then it probably will eventuate into a wide-ranging farce like Abbotts “KILL BILL” (Shorten) RC in 2013

The only good benefit that came out of that RC was that the TWU Super in WA were found to be paying TWU shop stewards around $75,000 a year for the shop stewards to lean on TWU members who did not have funds in TWU Super

From memory, there was some evidence that the retainers paid to union officials on the boards of superfunds ended up in the hands of the union itself, and then subsequently into its contributions into Labor’s election funding.

But be careful what you wish for: the same nonsense goes on in the corporate world, disguising contributions to political parties.

It’s all one great big smelly joke, and the joke is on us

Wildcat
12 days ago

I would like to see a supplier audit for the ISN funds. Who owns/runs the cleaning company, who does the labour outsourcing, who does IT, marketing, “consultants”. Are all of these above board and open to any bidder for the work?

Oh look, a pig just flew by my window!!

Terry G
12 days ago
Reply to  Wildcat

I’d love to see this as well.