APRA plans to open the books on super fund spending
Published information would include donations to unions and political parties, as well as executive remuneration.
Superannuation fund members will get a window on where their money goes – including to unions and political parties – under by proposals by APRA to “significantly increase” the visibility of what is spent and invested by the industry giants.
The regulator plans to publish total fund expenditure and expanded asset allocation data by mid-2024 and has written to superannuation trustees inviting their feedback.
The data, which would take in the politically contentious issue of donations to political parties and unions, would be collected later this year following recent amendments to reporting standards.
It would operate under Phase 1 of APRA’s Superannuation Data Transformation, a multi-year project to enhance the depth, breadth and quality of data collected.
APRA’s initial proposal is to determine most of the new superannuation data collected as being non-confidential and, therefore, able to be published.
It proposed to publish:
- Total expenses for the industry by category and by internal, related outsourced and non-related outsourced arrangements for administration and operating expenses and for investment expenses.
- Total expenses at individual fund level by category, including expenditure for marketing and sponsorships, industrial bodies, related parties, director and executive remuneration, and political donations by the payee or service provider.
- Total expenses with the name of the service provider where the provider is a promoter (such as a third party that receives a benefit for marketing a fund).
- Additional aggregated asset allocation data for fund investments in property and infrastructure, alternative strategy funds, listed equity and private equity. APRA will seek trustee feedback on publishing the data at an individual fund level as well.
APRA deputy chair Margaret Cole said the proposals represented an important step forward in achieving greater transparency in the sector.
“It is APRA’s aim to publish as much of the data that we collect as possible, especially where there is a strong public interest in having access to high-quality industry data that is comparable across funds,” she said.
“Under these proposals, members would have a clearer and more detailed picture of how their money is being spent and invested, while trustees would be further compelled to remain closely focused on improving member outcomes.”
In May, APRA said it would investigate super fund payments to unions and whether they were in the financial interests of members.
Nearly $9 million flowed from industry super funds to unions in 2021–22, according to reports in The Australian, sparking accusations that funds were making non-commercial payments against the best interests of members.
“This whole issue of members’ best financial interest and what super funds are spending members’ money on is absolutely critical to us,” Ms Cole said at the time.
The consultation, which will include two roundtable discussions with trustees and other industry stakeholders, closes on 29 November 2023.
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