YFYS superannuation review outcome

The Australian Government has released the results of its review of the Your Future, Your Super laws and announced its next steps to deliver on members' best interests.

The review aimed to identify any unintended consequences of the laws leading to poor outcomes for members, with feedback primarily focused on the annual superannuation performance test.

The government will address several unintended consequences of the test identified in the review while maintaining the test's integrity, with updates to the performance test outlined in exposure draft regulations.

The review also heard feedback on other measures of the Your Future, Your Super laws, including stapling. The government is committed to stapling, the eradication of unintended duplicate accounts, and will work with stakeholders to deliver on its goal.

The existing test may unintentionally affect the investment decisions of all funds to reduce the risk of failure and closure by encouraging short-termism and benchmark hugging. The existing test may not reflect the diversity and objectives of choice products.

The tool could be improved by including additional metrics or features and extending to choice products.

There is an increasing administrative burden on employers' onboarding processes, particularly where an employment link is not already established, due to stapling.

The Australian Taxation Office (ATO) is anticipating that it will have an IT service for digital service providers available to adopt in April 2023, which should support a more streamlined service.