APRA suspended much of its planned policy and supervision agenda in March 2020 in order to prioritise activities to respond to the impacts of COVID-19.

APRA stated that the proposed policy and supervision priorities for the coming 12 to 18 months require working closely with peer regulators to deliver efficient, proportionate regulation that facilitates a resilient, competitive and innovative financial sector, able to support the recovery from the impacts of COVID-19.

APRA’s key policy priorities for super include supporting the implementation of the government’s Your Future, Your Super reforms to improve member outcomes as well as progressing a range of enhancements recommended by APRA’s post-implementation review of the original superannuation prudential framework introduced in 2013.

In relation to its supervision activities, APRA stated its priorities were to include addressing areas of MySuper underperformance, along with taking enforcement action where appropriate and providing greater transparency through the expansion of the heatmaps to include Choice products.

Other key objectives will include finalising and implementing a revised prudential standard on remuneration, a key royal commission recommendation that remains outstanding, along with including the development of a new prudential standard on resolution and recovery planning and taking into account the lessons and learnings of the past 12 months.

APRA chair Wayne Byres said while the industry demonstrated its resilience in 2020 on the back of substantial public sector support, it was important to continue strengthening the financial system to ensure it was prepared for the potential crises of the future.

“Last year, the industry demonstrated an ability to adapt and continue serving the needs of customers, despite a number of severe operational challenges and disruptions,” Mr Byres said.

“The robust response to date is not a cause for complacency, but underlines the value of an ongoing regulatory program that seeks to identify risks and put in place appropriate mitigation strategies to protect the interests of depositors, policyholders and fund members.

“As a forward-looking safety regulator, APRA’s priority is to maintain a financial system that is resilient and able to fulfil its important role in the Australian economy, whatever the circumstances.

“Given the continued uncertainty generated by COVID-19, APRA’s proposed policy and supervision agenda for the coming period will remain responsive to the external environment to ensure it continues to prioritise the areas of greatest need.”