Australia's corporate regulator has warned superannuation funds they could face legal action if they do not step up, following a review of 45 trustees covering $1.6 trillion in benefits for more than 12.8 million members. Commissioner Simone Constant said that when trustees fail to learn from complaints, small problems left unidentified could snowball into widespread failures and erode trust in the system.
The review found that members were more likely to get resolutions if they went to the financial ombudsman directly rather than to their super fund. From July 2023 to June 2026, more than 19,400 complaints about the 45 funds were made to the Australian Financial Complaints Authority (AFCA). AFCA received 8,755 superannuation complaints in 2025–26, up 42 per cent on the previous year, and complaints about super funds refusing to pay claims rose by 80 per cent.
Constant said close to one quarter of trustees were not analysing complaints data to identify systemic issues on a regular basis, and more than half had identified fewer than five systemic issues from complaints over two years, with 14 identifying none. She described the low levels of issue identification as a “potential red flag, not evidence of better performance”. She said AFCA identified systemic issues from complaints it received at almost twice the rate trustees identified them from complaints they received.
The review also found several trustees attributed more than 60 per cent of recorded complaint causes to members. “Blaming the customer is not a complaints strategy,” Constant said. The review noted a case in which a tax-related system problem had been raised through complaints for years before the trustee investigated whether other members were affected, with early estimates suggesting about 1,200 could be impacted, and another in which more than 250,000 members were unable to access documents online at different times.
Constant said superannuation trustees managed $3.4 trillion in Australians' retirement savings. She said ASIC was willing and able to bring actions against funds for not meeting their legal responsibilities.
Financial Services Council chief executive Blake Briggs said trustees had a responsibility to deliver high-quality services, and noted they had undertaken significant work to strengthen complaint-handling frameworks in recent years, including improving processes for identifying systemic issues. Briggs said he supported ongoing industry efforts to promptly identify and address systemic issues, learn from complaints and improve processes. He also noted the government had announced its intention to introduce mandatory service standards in response to failures in how major funds handled death benefit and group life claims.
Analysis
Why This Matters
- Superannuation is a cornerstone of Australians' retirement savings; poor complaint handling can leave members financially worse off at vulnerable times.
- The regulator's warning of legal action signals a shift towards greater enforcement, potentially forcing funds to overhaul internal processes.
- Rising complaint numbers and delays could erode public trust in the super system if not addressed.
Background
The Australian Securities and Investments Commission has long been critical of how super funds handle complaints, particularly over death benefits and disability insurance claims. In March 2025 it called for an overhaul of death benefit claims handling, citing excessive delays and poor service. In October 2025 it criticised funds' communication with retirees. The government has also signalled plans to introduce mandatory service standards following failures in the sector.
Key Perspectives
ASIC Commissioner Simone Constant: says funds must stop blaming members and instead use complaints to identify systemic failures. She warns that ASIC is prepared to take legal action against trustees that do not meet their obligations.
Financial Services Council chief executive Blake Briggs: agrees trustees have a responsibility to deliver high-quality services and says the industry has been strengthening complaint handling. He supports ongoing reforms and notes that mandatory standards are being considered.
What to Watch
- Whether ASIC follows through with legal action against specific funds.
- The progress of the government's mandatory service standards for super funds.
- Whether complaint numbers continue to rise and how funds respond to the regulator's findings.
Checked
12 claims in this story checked against 1 source: 12 supported.
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- SupportedASIC gave super funds a blunt warning about complaint handling.Latest business news: “It has prompted ASIC commissioner Simone Constant to hand down a blunt warning to the funds”
- SupportedThe regulator found super funds were failing their members.Latest business news: “Watchdog says super funds are failing their members.”
- SupportedFunds that do not step up could face legal action.Latest business news: “Australia's corporate regulator says superannuation funds are failing their members in managing their retirement savings, warning that those who do not step up could be staring down future legal action.”
- SupportedConstant said, “Blaming the customer is not a complaints strategy.”Latest business news: ““Blaming the customer is not a complaints strategy,” Ms Constant said.”
- SupportedConstant described low levels of issue identification as a “potential red flag, not evidence of better performance”.Latest business news: ““We see low levels of systemic issue identification as a potential red flag, not evidence of better performance,” Ms Constant said.”
- SupportedASIC's review covered 45 superannuation trustees.Latest business news: “The Australian Securities and Investments Commission's (ASIC's) latest review looked at 45 superannuation trustees,”
- SupportedThe review covered trustees responsible for $1.6 trillion in benefits.Latest business news: “covering $1.6 trillion in benefits for more than 12.8 million members.”
- SupportedThe review covered trustees serving more than 12.8 million members.Latest business news: “covering $1.6 trillion in benefits for more than 12.8 million members.”
- SupportedMembers were more likely to get complaint resolutions by going to the financial ombudsman than by raising complaints directly with their fund.Latest business news: “It found that superannuation members were more likely to get resolutions to their complaints if they went to the financial ombudsman rather than raise it directly with their super fund.”
- SupportedMore than 19,400 complaints about the 45 funds were made to AFCA from July 2023 to June 2026.Latest business news: “ASIC said during July 1, 2023 and June 30, 2026, more than 19,400 complaints were made to AFCA about superannuation concerning the 45 funds that were part of its whole-of-industry review.”
- SupportedAFCA received 8,755 superannuation complaints in 2025–26, up 42 per cent on the previous financial year.Latest business news: “the financial ombudsman receiving 8,755 complaints, up 42 per cent on the previous financial year.”
- SupportedComplaints about super funds refusing to pay claims rose by 80 per cent.Latest business news: “AFCA said complaints about super funds refusing to pay claims rose by 80 per cent.”