Jane Hume (Victoria, Liberal Party, Minister for Superannuation, Financial Services and the Digital Economy) Share this | Hansard source

Yes, Senator Hanson, that's correct. The performance test, or the underperformance test, will apply to eight years of performance of funds, and that includes both investment and administrative fees. If a fund hasn't performed—if it hasn't lived up to its expectations or what was written on the box isn't what is being delivered to members—then that fund will have to write to members and tell them that it has underperformed, and not only that but members also will be directed to that online comparison tool so they can be given a nudge, essentially, to find a product that might be better suited to them. If a fund underperforms two years in a row—and we're talking 50 basis points below its own benchmark on a rolling eight-year average—then it won't be allowed to accept new members. Existing members can stay there, but new members can't join. The government believes that this is a very reasonable underperformance test and will sift out those that are good at what they do and those that aren't good at what they do—those that are delivering to their members and those that aren't delivering to their members and are hiding behind the skirts of those funds that are performing.