The system delivers, on average, decent annual net returns – 5.9 per cent after expenses and taxes over the past 21 years – but there is a significant variance in returns across the system.

Over the 13 years to 2017 26 funds, with 7.2 million members and more than $400 billion of assets, performed above their benchmark.

Over the same period 42 funds performed below their benchmark, with 29 – totalling five million member accounts and $270 billion of assets -- under-performing by more than 0.25 per cent.

Usually the debate about returns is a simple comparison of industry versus retail funds, with the conclusions distorted by the absence of any risk-adjustment to reflect quite different investment strategies and portfolios and by different member-driven options.

The PC deal with the ‘’apples and oranges’’ nature of the usual comparisons by constructing two benchmark portfolios reflecting funds’ average asset allocations.

It is a statement of the obvious that if fund members made better choices of where they directed their contributions they’d be substantially better off in retirement.

As a group industry funds delivered returns above their benchmark while retail funds under-performed theirs,’ largely, but not entirely, because it appears they weren’t that good at selecting the better-performing assets within the asset classes.

Industry funds also out-performed the retail funds in most asset classes.

It is a statement of the obvious that if fund members made better choices of where they directed their contributions they’d be substantially better off in retirement.

The PC’s focus is on the default funds or products, where MySuper products contain about half of all member accounts.

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While those default products perform better on average than the system as a whole, perhaps because they are lower-cost and simple, there were again big gaps in performance of the funds.

Thirty-two funds generated a median net return of 5.5 per cent. Twenty-one generated a median return of only 3.8 per cent. The difference, the PC says, amounts to more than $500,000 for the typical worker.

One area where Australian funds don’t compare well with their offshore counterparts is on fees, which cost fund members more than $30 billion a year.

While there have been economies of scale generated by the growth in the system and the funds, it is unclear whether members have benefited from them and there is a ‘’tail’’ of high-fee products (about $275 billion) where annual fees exceed 1.5 per cent of the balances of about four million members.

The PC has stuck to its somewhat controversial draft proposal that members should only be allocated to a default product once, when entering the workforce, and would choose that product from a shortlist of the best-performed funds, chosen by an expert panel.

That takes the choice of default option away from employers and unions and hands it to the member and, over time, might shift the balance of the system towards better-performing funds.

The hope is also that competition to get on that short-list would see the funds that initially missed out trying to improve their performance and lowering their costs, or merging to gain scale and efficiencies.

Merging the 50 highest-cost funds with the 10 lowest-cost funds, would, the PC estimated, generate annual savings of at least $1.8 billion.

There’s a raft of other recommendations on issues like the automatic consolidation of low-balance accounts, better and simpler ‘’dashboards’’ for all products, the limitation of all fees to cost-recovery, the end of the grandfathered trailing commissions for financial advisers, opt-in insurance for younger members, governance standards for trustee boards and some fairly stern advice to the Australian Prudential Regulation Authority about how it should perform its role in regulating the sector.

The most important issues it has canvassed and opined on, however, remain the obvious: investment performance and costs and trying to encourage or, indeed, structure a migration of members from the perennially under-performing funds to those with low costs and strong investment returns.