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Your Future, Your Super: Review of the performance test

The Government recently announced the Your Future Your Super (YFYS) reforms as part of the 2020 Budget. We applaud the desire for greater accountability and acknowledge that the performance test was a recommendation made by the Productivity Commission. Consumers deserve an effective performance test with limited undesirable outcomes.

A voluntary working group of experienced representatives from leading investment and actuarial consultants has explored the YFYS performance test in detail. Based on the analysis we have strong concerns that the YFYS performance test will be ineffective at identifying poor performing funds while introducing a range of undesirable outcomes. We believe the detriments of the YFYS performance test may easily outweigh the benefits.

Our research quantifies the effectiveness of the metric and many of the undesirable outcomes. We explore alternatives but do not make a recommendation at this point.

A range of materials (papers and models) have been made available via the link below.

We welcome feedback on our work and happy to discuss any aspect in further detail.

Resources

Click here to access a range of materials (papers, presentations, models and templates).

Collaborators

David Bell

The Conexus Institute

Emily Barlow

Mercer

Andrew Boal

Rice Warner

Kim Bowater

Frontier

Nick Callil

Willis Towers Watson

David Carruthers

Frontier

Matthew Griffith

JANA

Clayton Sills

Mercer

Tim Unger

Willis Towers Watson