Your Future, Your Super legislation and supporting material
The Government’s Your Future, Your Super (YFYS) reform package was announced in the 2020-21 Budget. The Treasury Laws Amendment (Your Future, Your Super) Act 2021 (the YFYS Act) included amendments to the Superannuation Industry (Supervision) Act 1993 (SIS Act) to require APRA to conduct an annual performance test for MySuper products and other prescribed products.
In August 2023, the Superannuation Industry (Supervision) Regulations 1994 (SIS Regulations) were amended by the Superannuation Industry (Supervision) Amendment (Your Future, Your Super—Addressing Underperformance in Superannuation) Regulations 2023 (YFYS Regulations 2023) to support the improved implementation of the annual performance test, particularly in relation to the expansion of the test to trustee-directed products, and address issues raised in Treasury’s review of Your Future, Your Super laws.
- The YFYS Act is available here: https://www.legislation.gov.au/Details/C2021A00046.
- The YFYS Regulations 2023 are available here: https://www.legislation.gov.au/Series/C2004A04633. here: https://www.legislation.gov.au/Details/F2023L01063.
- The SIS Act is available here:
- The SIS Regulations are available here: https://www.legislation.gov.au/Details/F2023C00656.
YourSuper Comparison Tool
One of the key reforms included in the Your Future, Your Super reform package was the creation of a new interactive online YourSuper Comparison Tool aimed at consumers. The Tool was built by the Australian Taxation Office and is available here: https://www.ato.gov.au/Calculators-and-tools/YourSuper-comparison-tool/.
The information displayed in the comparison tool is collated and supplied by the Australian Prudential Regulation Authority (APRA).
MySuper products
Technical determination to combine performance histories of MySuper lifecycle products
The YFYS Regulations 2023 included a power for APRA to make a legislative instrument to modify the actual return formula and the benchmark return formula used in the performance test, as APRA considers reasonably necessary, to reflect a change of lifestage for a lifecycle product. Pursuant to the relevant regulations, APRA made a technical determination, which was registered on the Federal Register of Legislation on 7 August 2023 and is in effect from the 2022/23 performance test. The technical determination can be found below:
A response letter to industry on the consultation on the technical determination released in April 2023, the final clean and marked up versions of the determination and the non-confidential submission received on this consultation can be found at: Proposed technical determination for combining MySuper product performance histories.
Updated information paper on combining MySuper product performance histories
On 9 August 2023, APRA released an updated information paper on its approach to administering the annual performance test for MySuper products, with a focus on APRA's methodology for combining performance in the performance test. The information paper was updated to reflect the introduction of Superannuation Technical Determination No. 1 of 2023 Actual and benchmark return formulae modifications.
The information paper can be found below:
Information paper - Combining MySuper product performance histories – APRA’s approach - August 2023
Trustee-directed products
Information paper on combining performance histories of trustee-directed products
On 20 April 2023, APRA released an information paper on APRA's methodology for combining performance histories of trustee-directed products for the performance test.
The information paper can be found below:
Information paper - Combining trustee-directed product performance histories – APRA’s approach.
Published 20 April 2023
APRA expects an RSE licensee to consider whether it is appropriate for two or more TDPs to be treated as a combined product with a continuous performance history.
An RSE licensee seeking to combine its products’ performance histories is requested to complete the ‘TDP mapping’ spreadsheet and submit it to APRA. APRA will consider the submission and inform the RSE licensee whether APRA will exercise its flexibility to combine performance histories.
The TDP mapping spreadsheet can be found below: