On my system it does. Are you trying to upgrade to a new distro?
If not, I think you can run sudo apt-get install updates to sync your system then run sudo apt-get install upgrade to download any upgrades to your currently installed applications.
I don't think the method above works on sercurity patches and whatnot. Maybe someone else can answer that cuz I'd like to know myself.
No I just want the latest updates, which of course I find buy using the update manager. I just wondered if the update notice would appear in the panel.
You can add the update manager to the panel. Just right click on the panel and select "add to panel" then click "application launcher" and find the update manager to add it to the panel.