The Financial Regulator Assessment Authority’s review of APRA will focus on the effectiveness and capability of its supervision of the superannuation industry.

The FRAA has issued a discussion paper, setting out a range of questions and calling for submissions by December 15.

It wants to know whether APRA clearly communicates its supervisory priorities and clearly implements its supervision activities. It wants to know if there are gaps in APRA’s supervision of superannuation and whether it has the capabilities for detecting prudential risk and conducting its activities to achieve the right outcomes.

It also wants to know what steps APRA has taken to reduce the regulatory impost of its supervisory activities.

The FRAA was established last year, giving effect to a Hayne royal commission recommendation that APRA’s and ASIC’s effectiveness in delivering on their mandates be subject to regular, independent expert review.

It produced its first review on ASIC earlier this year.

Its role is to provide the Treasurer with assessment reports every two years, which will be made public. The Treasurer may also request reports “on any matter relating to APRA or ASIC effectiveness and capability” on an ad hoc basis.

It does not have the power to direct the regulators to implement any recommendations it makes. Nor can it comment on specific cases of regulatory enforcement actions or decisions.

Its members are former Macquarie Group chief executive Nicholas Moore (who is chair), former senior banker and private health insurance boss Craig Drummond, and competition lawyer and chair of Allens Fiona Crosby.