APRA’s Superannuation Data Transformation to enhance industry transparency and accountability

The Australian Prudential Regulation Authority (APRA) has launched a multi-year project to upgrade the breadth, depth and quality of its superannuation data collection. 

APRA’s Superannuation Data Transformation aims to drive better industry practices and improve member outcomes by significantly enhancing the comparability and consistency of reported data. The project will make it easier to scrutinise and reliably compare fund and product performance, especially in the choice segment of the market.

The Discussion Paper being released today outlines the scope, objectives and approach to the Superannuation Data Transformation.

APRA collects data from 209 registrable superannuation entity (RSE) licensees and Exempt Public Sector Schemes¹, which manage more than $2 trillion in assets in 27 million member accounts. The data is also relied on by other financial regulators, including the Australian Securities and Investments Commission and the Australian Bureau of Statistics.

Deputy Chair Helen Rowell said the Superannuation Data Transformation was an essential component of APRA’s strategic focus on improving member outcomes. 

“The superannuation industry plays a vital role in protecting Australians’ retirement savings, and it’s increasingly integral to the strength of the economy. With individual RSE licensees responsible for managing many billions of dollars, regulators, policymakers and other industry stakeholders must have a more complete picture of how they are performing,” Mrs Rowell said.

“APRA is largely satisfied with the state of our MySuper data collection, but there are some areas that require enhancements; and we need to significantly upgrade the scope and granularity of our data on the choice sector. A lack of industry agreement in areas such as asset class definitions is also hampering the ability to make meaningful industry-wide comparisons, and this consultation seeks to provide clarity and consistency in these areas.

“APRA will use the insights gained from a more complete and granular data collection to sharpen its supervision priorities and drive better industry practices. Heightened transparency will also intensify the pressure on underperformers to lift their game.

“The improved data collection will also support the implementation of other key regulatory requirements including the business performance review², and the legislated outcomes assessments which form a key input to these reviews. It also enables the planned expansion of our new performance heatmap to include choice products.”

Given the scale and complexity of the Superannuation Data Transformation, APRA has divided the consultation into three phases:

• Phase 1 (Breadth) will address the most urgent gaps in APRA’s data collection, particularly for choice products and investment options;
• Phase 2 (Depth) will increase the granularity of the entire collection, taking advantage of APRA’s new Data Collection Solution and enhanced data analytic capabilities; and
• Phase 3 (Quality) will assess the quality and consistency of the additional data reported during Phases 1 and 2, and review and address any implementation issues.

Each phase will involve the release of multiple topic papers, each covering a different aspect of the consultation. The first topic paper, RSE Structure and Profile, together with a template for a pilot collection of data in these proposals, has been released in conjunction with today’s Discussion Paper.

A key element underpinning the objectives of the Superannuation Data Transformation is improved industry transparency, which APRA will achieve through proposals to determine more data (including all data collected under the reporting standards in Phase 1) to be non-confidential, enabling APRA to publish the data.  

APRA intends to respond to Phase 1 of the consultation and finalise changes to its reporting standards by mid-2020. The first tranche of data collected under Phase 1 is due to be published in late 2020.

The Phase 1 Discussion Paper and the first topic paper on RSE Structure and Profile are available at: https://www.apra.gov.au/consultation-on-apras-superannuation-data-transformation 

^1. Exempt public sector superannuation schemes (EPSSS) are public sector superannuation schemes that choose not to be regulated by APRA. However, for statutory purposes, a number of EPSSS report to APRA under an agreement between the Commonwealth Government and each of the State and Territory Governments. 

^2. The business performance review is detailed in SPS 515 Strategic Planning and Member Outcomes.