By Zein El-Hassan, Partner
Since the Retirement Income Covenant[1] (RIC) came into effect in July 2022, trustees of regulated superannuation funds have been required to formulate, implement, and regularly review their retirement income strategy (RIS).
From 1 July 2025, super fund trustees will also be required to undertake a triennial review of their RIS. This article outlines the legislative requirements, regulatory expectations and practical steps for trustees preparing for this critical review.
The SIS Act requires trustees to document their RIS and the decisions (and reasoning) made in formulating the strategy. [2]
The RIS must be for the benefit of members who are retired or approaching retirement and address how the trustee will assist those members to achieve and balance three key RIC objectives, namely:
The RIS must also be publicly available on the super fund’s website, which is intended to enable members to compare retirement income strategies across funds.
From the start, APRA and ASIC have been vocal about their expectations in relation to retirement income strategies.
In the March 2022 Joint Letter[3], before the start date of the RIC, the regulators encouraged super fund trustees to design a RIS tailored to their fund’s membership, leveraging the flexibility within the legislation to reflect member demographics and retirement preferences.
In the July 2023 Thematic Review Report[4], the regulators urged trustees to self-assess against examples of better practices identified across the industry with the expectation that trustees will address any identified gaps. The regulators observed that trustees were not giving sufficient urgency to developing and implementing effective RIS frameworks.
In the July 2024 Pulse Check[5], the regulators, while acknowledging progress, observed that many trustees still did not adequately measure the success of their RIS-related initiatives. Again, the regulators encouraged trustees to address gaps and leverage their insights from the July 2023 Thematic Review Report and July 2024 Pulse Check to enhance their strategies.
In June 2025, Mills Oakley published a report that provided an independent sector-wide review of how super fund trustees are responding to the RIC.[6]
The report benchmarks 80 funds across key characteristics such as strategic alignment, member segmentation, assistance to members, governance maturity, and innovation in product and advice offerings.
The findings reveal significant variability in compliance, strategy maturity, and member focus, highlighting both encouraging progress and persistent gaps.
Encouragingly, 30 funds demonstrated, through their RIS summaries, a strong alignment with the requirements and policy objectives of the RIC.
However, a sizeable proportion of the RIS summaries lack specificity, detail and meaningful engagement (including the failure to publish a summary at all), suggesting minimal strategic alignment with the RIC requirements.
Consistent with the message from the regulators in their industry reviews, there is more work to be done in this space by super fund trustees.
From 1 July 2025, APRA’s prudential standard SPS 515 will require trustees to undertake a triennial review to assess the appropriateness, effectiveness, and adequacy of their RIS.
APRA’s updated SPG 515 states that a triennial review should consider whether the retirement income strategy:
There is also additional guidance within SPG 515 relating to the trustee’s business plan, business performance review and the annual outcomes assessment that should also inform the approach to the triennial review of the RIS.
According to SPG515, trustees should:
The guidance in SPG 515 should be considered together with the examples of better practices and the expectations of APRA and ASIC as outlined in the July 2023 Thematic Review Report and July 2024 Pulse Check (as mentioned above).
Finally, APRA encourages trustees to consider obtaining advice on the triennial review from an operationally independent and appropriately experienced person,[16] as this can provide valuable insights and enhance the objectivity of the assessment.
Drawing on the requirements of SPS 515, the guidance in SPG 515, and our experience, we have developed an approach to support trustees to optimise their RIS, RIS methodologies and RIS-related initiatives as part of their triennial review.
Our approach focuses on:
We would welcome the opportunity to support you in undertaking your triennial review or to undertake an independent legal and regulatory review of your retirement income strategy.
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[1] Section 52(8A) of the Superannuation Industry (Supervision) Act 1993 (Cth) (SIS Act).
[2] Section 52(8A) and 52AA of the SIS Act.
[3] Letter to RSE Licensees ‘Implementation of the Retirement Income Covenant’ dated 7 March 2022.
[4] Information Report ‘Implementation of the retirement income covenant: Findings from the APRA and ASIC thematic review’ dated July 2023.
[5] Industry Update ‘Pulse check on retirement income covenant implementation’ dated July 2024. The regulators are about to publish the results of their most recent pulse check.
[6] ‘Measuring Up: How Super Funds Are Responding to the Retirement Income Covenant’ Mills Oakley Report June 2025. The review was conducted, and the report was authored, by Emma Higgs, Special Counsel, Mills Oakley.
[7] SPG 515.8.
[8] SPG 515.81. The RIC objectives are set out in section 52AA(2) of the SIS Act and are summarised earlier in this article.
[9] SPS 515.26 and SPG 515.50-53 and Table 3.
[10] SPG 515.7.
[11] SPG 515.51.
[12] SPG 515.33-37 and Table 2.
[13] SPG 515.52.
[14] SPG 515.53 and Table 4.
[15] SPG 515.73-74.
[16] SPG 515.9.
If you would like further information or have any queries regarding other matters, please do not hesitate to contact:
