Super Alert – 31 October 2025: APRA updates re changes to longevity products, ATO guidance ahead of Paid Parental Leave Superannuation Contribution changes

Welcome to the weekly KHQ Super Alert. This week APRA released updates about its proposed changes to governance frameworks for regulated entities and the capital framework for longevity products. Treasury opened a consultation on draft regulations to support legislative changes to modernise payment systems. Meanwhile the ATO released guidance for funds ahead of changes to the Paid Parental Leave Superannuation Contribution rules.

ATO – Increase to amount of lost and unclaimed super

On 29 October 2025, the ATO released an update confirming that the amount of lost and unclaimed super has risen by $1.1 billion since 2024, to a total amount of $18.9 billion. The ATO encourages people to access ATO online to check if they have any lost or unclaimed super.

Click here for details.

APRA – Second round of consultation on proposed changes to longevity products

On 29 October 2025, APRA commenced its second round of consultation on amendments to its capital framework for longevity products, including annuities. The amendments are intended to ‘create an environment that supports the development and availability of longevity products for Australian retirees, while safeguarding policyholder interests’.

As reported in our Super Alert of 17 October 2025, APRA recently finalised its first round of consultation with life insurers in relation to the proposals. Following industry feedback, APRA has proposed a more ‘principles-based approach for determining capital requirements’.

The consultation period closes on 17 December 2025.

Click here for details.

Treasury – Consultation on payments system draft regulations open

On 29 October 2025, Treasury opened a consultation on a draft version of the Payment Systems Legislation Amendment (2025 Measures No. 1) Regulations 2025 and related Explanatory Statement. The purpose of these regulations is to support the amendments in Schedule 1 of the Treasury Laws Amendment (Payments System Modernisation) Act 2025 (see our Super Alert of 5 September 2025 for further information).

According to the draft Explanatory Statement, the regulations support the Act by ‘prescribing special regulators, heads of special regulators and eligible delegates in relation to special regulators that are nominated special regulators’. The regulations propose to amend the:

• Payments Systems (Regulation) Regulations 2006;
• Australian Securities and Investments Commission Regulations 2001; and
• Corporations Regulations 2001.

The consultation period closes on 11 November 2025.

Click here for details.

APRA – Speech in relation to technology risks for regulated entities

On 28 October 2025, APRA published a speech delivered by Executive Board Member, Suzanne Smith. The focus of the speech was on technology and the associated risks facing APRA-regulated entities. Some of the key comments included the following:

• ‘Today’s banks, insurers and super funds aren’t simply financial services providers; they have effectively become technology companies.’
• ‘Many of the banks, insurers and superannuation trustees APRA supervises rely heavily on legacy systems, which are often built on now outdated software and hardware.’
• ‘One of the key responsibilities internal audit has is making sure the fundamentals are in place…[including in relation to] the delivery of digital transformation initiatives… [D]elaying the replacement of technology assets, for example, often comes with hidden costs which eventually need to be paid.’
• ‘One concern APRA is playing close attention to is concentration risk. Across banking, insurance and superannuation, critical operation delivery often hinges on a concentrated set of technology vendors…[which] means if one of these technology providers fails, even temporarily, they can potentially take down services at every company relying on their services.’
• ‘Risks may evolve as technology changes, but the broad principles of good risk management remain the same.’

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APRA – Update to proposed governance framework modernisation

On 24 October 2025, APRA released an update in relation to its previously announced proposal to modernise the prudential framework on governance for APRA-regulated entities (see our Super Alert of 7 March 2025 for further information). The original announcement proposed eight measures to update APRA’s cross-industry prudential standards and guidance on governance.

After considering industry feedback, APRA has advised that it will modify the following three of its original proposals to ensure they do not create undue regulatory burdens for boards. Only the following two are relevant to superannuation trustees:

• ‘Instead of a tenure limit for non-executive directors of 10 years with the possibility of a two-year extension, APRA now proposes a hard tenure limit of 12 years with short extensions in limited circumstances.’
• ‘A proposal to require significant financial institutions to engage early with APRA on responsible person appointments and succession planning will also not proceed.’

APRA has advised that it will formally consult with industry about these changes ‘in the first half of next year’.

Click here for details.

ATO – Guidance released for implementing Paid Parental Leave Superannuation Contributions

On 24 October 2025, the ATO released guidance for superannuation funds in relation to implementing the Paid Parental Leave Superannuation Contribution (PPLSC) rules which will apply to anyone who receives Parental Leave Pay for a child born or adopted on or after 1 July 2025.

The PPLSC is:

• ‘based on the superannuation guarantee rate, and will include an interest component’;
• ‘paid as a lump sum after the end of the financial year in which Parental Leave Pay was received’; and
• ‘usually paid to the super fund where superannuation contributions are currently paid.’

PPLSC are to be treated as a concessional contribution and subject to the usual 15% tax. The first payments of the PPLSC from the ATO will commence from July 2026.

Click here for details.

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