19 August 2026
By Paula Benson, Chief Strategy Officer, AustralianSuper
Originally published in the Australian Financial Review on August 19 2026.
Nature has given us two solutions to protecting Australians’ retirement savings, and we’re only using one of them.
The natural world demands competition and so does the super sector. We compete intensely to give consumers the best results on performance, service, fees and insurance.
But the other natural solution is sunlight – and right now, it only shines on some parts of the retirement sector.
Australians are moving their life savings into SMSFs and platform products for many reasons, and this competition is vital for the entire sector.
But it’s very difficult for anyone to know how the performance is measuring up against the other options available to them.
Right now, the data that is published on SMSFs and some platform financial products is either limited, not fully accessible or significantly delayed.
How is anyone supposed to make a good decision with their most important financial asset if they can’t measure how well their choices are performing?
Retail and industry super funds compete publicly, showing their returns, and their fees out in the open.
We built this great social reform on the premise that competition will drive better returns and better service for members. It’s working.
What’s not working is the visibility gap between how funds like AustralianSuper perform and how some managed funds and SMSFs perform.
As a nation, we need it to work. The returns from superannuation each year will make sure our pension system isn’t overloaded as 2.5 million Australians retire over the next 10 years.
How do we know there’s a problem? The SMSF sector itself says so.
Research from the University of Adelaide and the SMSF Association showed that in 2023-24 a full quarter of SMSFs returned less than 1.9 per cent.
That compares with up to 8 per cent for the bottom quarter of the 85 APRA regulated super funds that year.
Performance-tested funds cannot afford underperformance like that for long – they get better fast or face failing the performance test, which has cleared underperforming funds from the industry.
More people are now considering SMSFs earlier in their working lives, so the risk of poor decisions is magnified.
Transparency about returns for SMSFs and non-trustee directed platform products is just part of the issue.
ATO data shows many people with smaller SMSF balances experienced weaker returns than those with more money to invest. Unfortunately, even a few years of sub-par returns early in life can be very costly, with years of compounding still to come.
That’s why the government used to have a minimum balance recommendation before someone should consider an SMSF. Unfortunately, that guidance was removed.
This isn’t just a “buyer beware” issue. When people lose their retirement savings, they often have to fall back on the pension.
Australia has made incredible strides to reduce reliance on the taxpayer-funded pension.
Pension spending fell from 3 per cent of GDP in 1980, to 2.5 per cent in 2025 and it’s on track to fall to 2 per cent of GDP by 2060.
Compare that to other rich countries. Across the OECD, government spending on pensions averages 9 per cent of GDP, rising to 10.3 per cent of GDP by 2060.
Behavioural economists have long documented the “better-than-average” effect – our tendency to believe we are more capable than the average person.
It is one of the most common and persistent cognitive biases. Most people believe they rank well as drivers, decision-makers and investors. And sometimes they are.
But the real pitfall of the “better-than-average” effect is not about people being foolish. It’s about people making decisions with imperfect information.
Data must be made readily available on SMSF and platform product returns, including on smaller balances, so people can really understand the product they are choosing.
This will help our important financial advice industry as well, because advisers will be able to show people which products are really performing well, and how much they’ll pay for it.
The more representative and timely information people have, the better placed they are to decide whether investing on their own suits them, or if they would prefer to outsource that to a team of professionals.
For super funds, that means pushing the stress of delivering returns onto a team of investment professionals, to build and manage a diversified portfolio, including private markets and private equity exposure.
Their performance gets intense scrutiny from regulators, the board and members – as it should.
The results they achieve are some of the most visible in the Australian market, and we all compete on that basis.
We let the sunshine in and it feels good. Now the entire superannuation sector needs to feel the heat.