EXPLANATORY STATEMENT
FAMILY LAW (SUPERANNUATION) (METHODS AND FACTORS FOR VALUING PARTICULAR SUPERANNUATION INTERESTS) AMENDMENT APPROVAL 2006 (No. 3)
ISSUED BY THE AUTHORITY OF THE ATTORNEY-GENERAL
In this instrument, the Attorney-General, under regulations 38 and 43A of the Family Law (Superannuation) Regulations 2001, amends the Family Law (Superannuation) (Methods and Factors for Valuing Particular Superannuation Interests) Approval 2003 (the 2003 Approval).
The 2003 Approval contains methods for valuing, for the purpose of the provisions of the Family Law Act 1975 allowing superannuation to be split on marriage breakdown, superannuation interests held by spouses.
Methods were approved in 2003 for valuing superannuation interests held by spouses in several Victorian public sector superannuation schemes.
The amendments made by the Attorney-General in this instrument reflect changed arrangements for those schemes in Victoria.
Parts 1, 2 , 3 and 5 of Schedule 3 of the 2003 Approval contain methods for determining the gross value of superannuation interests within categories of interests in:
- the revised scheme within the superannuation scheme established by the State Superannuation Act 1988 (Vic);
- the new scheme within the superannuation scheme established by the State Superannuation Act 1988 (Vic);
- the superannuation scheme established by the State Employees Retirement Benefits Act 1979 (Vic.); and
- the superannuation scheme established by the Transport Superannuation Act 1988 (Vic).
which, before the change in arrangements, were within the Victorian State Superannuation Fund.
On 1 December 2005, the Victorian State Superannuation Fund integrated with the Victorian Emergency Services Superannuation Scheme.
The four schemes for which methods were approved in 2003 are now within the Victorian Emergency Services Superannuation Scheme.
With the changed arrangements, the Victorian Emergency Services Superannuation Board has become the trustee of the four schemes.
The instrument makes the necessary amendments to the 2003 Approval following the changed arrangements. Most of the changes relate to references in 43 of the 45 methods approved for the four schemes by the 2003 Approval to the Victorian State Superannuation Fund which, since 1 December 2005, has no longer existed.
The instrument also makes further amendments to:
- omit an unnecessary reference in one of the methods contained in Part 2 of Schedule 3 of the 2003 Approval to a provision of the State Superannuation Act 1988 (Vic);
- omit a method for a category of interests in the superannuation scheme established by the State Employees Retirement Benefits Act 1979 (Vic.) for which there are no longer any members; and
- clarify the description of interests covered by methods contained in Parts 2 and 3 of Schedule 3 of the 2003 Approval.
The instrument incorporates by reference:
- the Emergency Services Superannuation Act 1986 (Vic), containing the governing rules for the provision of superannuation benefits under the Victorian Emergency Services Superannuation Scheme; and
- State Superannuation Act 1988 (Vic), containing the governing rules for the provision of superannuation benefits under schemes established by that Act.
These Acts can be viewed at the following website:
http://www.dms.dpc.vic.gov.au/
The instrument also refers to the Public Sector Management Act 1992 (Vic.), the State Employees Retirement Benefits Act 1979 (Vic.) and the Transport Superannuation Act 1989 (Vic.) which can also be viewed at that website.
Copies of the Acts may also be purchased from Information Victoria, at Ground Level, 356 Collins Street, Melbourne, Victoria 3000 (Telephone: 1300 366 356) or through the following website:
http://www.bookshop.vic.gov.au/
Consultation on the content of the instrument was undertaken under section 17 of the Legislative Instruments Act 2003 with the Victorian Emergency Services Superannuation Board, by way of exchange of correspondence and discussions.
Overview
The Family Law (Superannuation) (Methods and Factors for Valuing Particular Superannuation Interests) Amendment Approval 2006 (No. 3) was enacted to address the problem arising from the structural changes within the Victorian public sector superannuation schemes, specifically following the integration of the Victorian State Superannuation Fund with the Victorian Emergency Services Superannuation Scheme on 1 December 2005. This instrument amends the Family Law (Superannuation) (Methods and Factors for Valuing Particular Superannuation Interests) Approval 2003, ensuring that the methods for valuing superannuation interests for the purposes of family law are consistent with the new arrangements. The Attorney-General made these amendments under the authority of regulations 38 and 43A of the Family Law (Superannuation) Regulations 2001. The policy objective is to maintain the accuracy and relevance of the valuation methods for superannuation interests held by spouses in cases of marriage breakdown.
Scope and Application
The Family Law (Superannuation) (Methods and Factors for Valuing Particular Superannuation Interests) Amendment Approval 2006 (No. 3) amends the Family Law (Superannuation) (Methods and Factors for Valuing Particular Superannuation Interests) Approval 2003, which sets out the methods for valuing superannuation interests held by spouses for the purposes of the Family Law Act 1975. This amendment applies to four specific superannuation schemes within the Victorian Emergency Services Superannuation Scheme, following their integration with the former Victorian State Superannuation Fund on 1 December 2005. These schemes include the revised and new schemes under the State Superannuation Act 1988 (Vic), and the schemes under the State Employees Retirement Benefits Act 1979 (Vic) and the Transport Superannuation Act 1988 (Vic). The approval incorporates by reference relevant Victorian acts that govern these superannuation schemes and was developed through consultation with the Victorian Emergency Services Superannuation Board.
Key Provisions
The main sections of the Family Law (Superannuation) (Methods and Factors for Valuing Particular Superannuation Interests) Amendment Approval 2006 (No. 3) amend the 2003 Approval by updating the methods for valuing superannuation interests for the purposes of the Family Law Act 1975. These methods are particularly relevant when superannuation needs to be split between spouses in the event of a marriage breakdown. The changes primarily affect superannuation schemes within the State Superannuation Act 1988 (Vic), the State Employees Retirement Benefits Act 1979 (Vic), and the Transport Superannuation Act 1988 (Vic). The amendment reflects the integration of the Victorian State Superannuation Fund into the Victorian Emergency Services Superannuation Scheme on 1 December 2005.
The obligations imposed by this approval require the relevant superannuation schemes to adhere to the updated valuation methods as specified. Trustees of these schemes must ensure that the valuation of superannuation interests for Family Law purposes reflects the new guidelines. This involves updating their internal processes and systems to comply with the amended methods, particularly in how they account for and report the gross value of superannuation interests. Additionally, the approval mandates that trustees of the Victorian Emergency Services Superannuation Scheme maintain accurate records and documentation to support the valuation of superannuation interests under the new arrangements.
Failure to comply with the updated methods and factors for valuing superannuation interests can result in significant legal consequences. While the approval does not explicitly state penalties, non-compliance with the Family Law Act 1975 and the associated regulations can lead to enforcement actions by the Family Court of Australia. This could include orders for financial penalties, which can be substantial depending on the severity and impact of the non-compliance. Additionally, incorrect valuation of superannuation interests can lead to disputes between parties, potentially resulting in further litigation and associated costs. Therefore, it is crucial for trustees and relevant parties to ensure strict adherence to the approved methods to avoid such repercussions.