Australia’s central bank has warned the nation’s A$4.8 trillion ($3.4 trillion) pension industry is facing a fresh set of challenges as millions of people enter retirement over the next decade and funds face cash outflows as people draw down their savings.

The so-called superannuation sector has become a large owner of domestic assets and has historically been a “countercyclical stabilizing force,” in times of market stress such as the Covid-19 pandemic, Reserve Bank of Australia Assistant Governor Brad Jones told the AFR Super and Wealth Summit in Melbourne on Monday.

Jones said weekly net inflows of A$1 billion–A$2 billion have historically helped the sector absorb stress. He warned that cushion may become less dependable over time as more funds move into net cash-outflow positions as more people retire and draw on their savings. About 2.5 million people are expected to retire over the next decade.

“When we look at all of that, what have been some very powerful tailwinds are going to start to become headwinds and just require more astute management,” Jones said, adding he was also concerned about concentration among some of the service providers in the industry, including funds’ administration.

Jones declined to answer a question on whether the RBA is set to hike interest rates again at its meeting next week.

Executives from two of the nation’s largest super funds, Aware Super and Australian Retirement Trust, said they had prioritized their liquidity management in anticipation of more members entering retirement and potential market shocks.

“Even in the way that we’re structuring our investment team, we have deliberately put in a head of liquidity looking and focusing in on a lot of these issues” that are related to both retirement savings but also market stresses, Aware Super CEO Deanne Stewart told the same panel.