The possibility of including Choice products in the super performance test “isn’t relevant” to the Your Future, Your Super bill, according to Minister for Superannuation, Financial Services, and the Digital Economy Jane Hume, as members select their own investments.
Industry Super Australia (ISA) requested an amendment to the inclusion of Choice products in the performance test, who said the sector was ‘littered with high-fee charging duds’.
This was further broached in the Senate today by Senator Rex Patrick in the second reading of the Your Future, Your Super (YFYS) bill.
The move was rejected by Hume, who said the performance test “isn’t relevant” for those Choice products where the member selected their own investments or were often advised clients.
If these type of products were included, she said, this would “diminish the usability” of the performance comparison tool.
“It is about looking at the performance of those funds which people have gone into unwittingly, those funds which they are languishing in unwittingly,” Hume said.
She said some 90% of Australian Prudential Regulation Authority (APRA) regulated accumulation funds were subject to the performance test and there was an intention to extend this in the future. From 1 July, 2022, it also hoped to include trustee-directed products.
Hume also rejected any requests to delay the bill as this would delay the implementation of the YFYS comparison tool and allow for more multiple accounts to be created in the interim.