APRA has published its analysis of performance of Choice superannuation products and will soon issue its Choice Product Heat-map similar to the MySuper Heat-maps recently released.
The Choice sector currently comprises 46% of the APRA regulated superannuation industry, ($859 billion), with some 568 Choice products available in the market.
The Choice sector typically enables members to exercise greater control over their superannuation investment strategy, by providing broader investment choices than those in a typical MySuper investment option. This might include a diverse range of fund managers, and single investment security options (i.e. shares and term deposits) and while APRA recognises this can be a positive feature of superannuation, providing greater member engagement, it raises the concern of complexity, additional costs, inefficiencies and the potential for sub-optimal outcomes for members.
The Information Paper was issued in October 2021, and outlines how APRA will be holding trustees to account for the outcomes they deliver to their members.
From 2022, APRA will produce the Choice Product Heat-map and the Your Future, Your Super, performance test.
A link to the APRA Information Paper is provide here.