Australia's Department of the Treasury has published a consultation paper on strengthening the annual superannuation performance test, seeking views on changes intended to reduce unintended barriers to investment while keeping the test objective and focused on member outcomes. The paper consults on benchmark changes for emerging and alternative assets, a possible move to risk-adjusted return assessment using a simple reference portfolio, routine benchmark reviews, and extending the test to more accumulation products. The consultation responds to concerns that the current design can encourage benchmark hugging and leaves parts of the system outside formal scrutiny. Options include creating a new emerging asset class benchmarked to CPI plus a margin, revising the existing Alternatives categories, or replacing the current strategic asset allocation benchmark with a simple reference portfolio matched by volatility. It also raises extending the test to diversified externally directed accumulation products, which Australian Prudential Regulation Authority data suggests could bring up to 7,500 additional products across 37 entities into scope, while single-sector and retirement products are framed as later-phase issues. Treasury notes the test currently covers more than 560 products representing around 62 per cent of the APRA-regulated sector by value, and that members in underperforming products fell from around 1 million in 2021 to about 8,500 in 2025. Submissions close on 19 June 2026. Treasury says the proposals have not received Government approval and are not law.
Department of Treasury (Australia) 2026-05-08
Australia's Department of the Treasury consults on strengthening the superannuation performance test with new benchmark options and broader product scope
Australia’s Department of the Treasury has released a consultation paper on strengthening the annual superannuation performance test to reduce barriers to investment while maintaining focus on member outcomes. Proposals include revised benchmarks for emerging and alternative assets, a risk‑adjusted return assessment using a simple reference portfolio with routine benchmark reviews, and extending the test to more accumulation products. Treasury notes the test currently covers more than 560 products, representing around 62 per cent of the Australian Prudential Regulation Authority‑regulated sector by value, with members in underperforming products falling from around 1 million in 2021 to about 8,500 in 2025.