The number of lost superannuation accounts has sky-rocketed with millions now dormant, according to figures released by the Australian Prudential Regulation Authority (APRA).

About five million superannuation accounts belong to people who have lost contact with their superannuation fund, noted APRA's Insight report.

"Despite significant efforts by many trustees and the Australian Taxation Office (ATO), there are still many millions of lost or small dormant superannuation accounts," the regulator said.

APRA attributes this growth to an "indirect effect of mandatory superannuation which has led to an ongoing increase in the number of member accounts."

At June 2006 there were 29.1 million member accounts, a substantial increase from the 16.3 million accounts in June 1996.

"The increase in the number of superannuation accounts is partly attributable to employees joining a new superannuation fund as they change employment," the report said.

The regulator said the choice of superannuation fund and easier portability arrangements may lessen the growth of superannuation accounts.

Superannuation funds are required to report lost members to the ATO.

Following the increasing use of tax file numbers for superannuation purposes, APRA noted that this should also assist in reducing the number of lost member accounts.

"Australians could help themselves create a better retirement income picture by ensuring that they are not among the millions with lost or sub-economic accounts scattered about in different funds," the report said.