The Government’s Your Future, Your Super reforms (the YFYS reforms) came into effect on 1 July 2021. The YFYS reforms require the superannuation industry to improve its efficiency, transparency and accountability.
Under the YFYS reforms, the Australian Prudential Regulation Authority (APRA) is required to conduct an annual performance test for MySuper products. The assessment under the performance test, in conjunction with the Australian Taxation Office (ATO)’s YourSuper comparison tool, is intended to hold Registrable Superannuation Entity (RSE) licensees to account for underperformance through greater transparency and increased consequences.
Among the key reforms are:
- Super accounts will follow members when they change jobs to reduce the incidence of members having multiple, unnecessary accounts
- Funds will be subject to an annual performance test by APRA. Funds that fail must notify their members, and if they fail two years running, they are unable to accept new members
- The best interests duty has been changed to a best financial interests duty
- The ATO will create a new interactive online YourSuper Comparison Tool aimed at consumers, developed in consultation with the Treasury.
The complete Your Future, Your Super Act is available here: https://www.legislation.gov.au/Details/C2021A00046
How you choose
You choose by using the ATO’s interactive online YourSuper Comparison Tool. This is the first time members will be able to compare the performance and fees of all MySuper products in a single place, based on independent and reliable information, with underperforming products clearly marked.
By facilitating greater and well-informed member engagement, the website will allow members to avoid poor-performing and high-fee products. Selecting a high-performing product compared with a poor-performing product can significantly boost retirement incomes.
The YourSuper comparison tool will mean members can simply and safely pick a well-performing MySuper product.
The key features of the YourSuper comparison tool are:
- Displays a quarterly updated table of MySuper products ranked by fees and investment returns, with products that have not met the new higher performance standard clearly highlighted as underperforming
- Links you to the fund’s website when you select a product from the table of MySuper products
- Shows your current superannuation accounts and allow you to select one of your existing superannuation accounts
- Prompts you to consider consolidating accounts if you have more than one fund.
Employees who are starting a new job will be able to use the YourSuper comparison tool to locate a MySuper account.
What do you need to do
When starting a new job, check with your new employer’s payroll team and request a superannuation standard choice form to provide them with your super account details.
Next, the key steps are to:
- Research and review your superannuation fund’s performance
- Review your super goals and your fund’s performance- performance of your super fund could potentially impact your retirement savings
- If you would like more information, talk to us and arrange a general super chat – we’re here to help.