MILITARY SUPERANNUATION AND BENEFITS (DELAYED PAYMENT OF BENEFITS) DETERMINATION 2009 – EXPLANATORY STATEMENT
1 Name of Determination
This determination is the Military Superannuation and Benefits (Delayed Payment of Benefits) Determination 2009.
2 Commencement
This determination is to take effect from the day after it is registered on the Federal Register of Legislative Instruments.
3 Background
The Military Superannuation and Benefits Act 1991 and Trust Deed makes provision for, and in relation to, the Military Superannuation and Benefits Scheme (MSBS) which is an occupational superannuation scheme for members of the Australian Defence Force.
Paragraph 3(1)(c) of the MSBS Trust Deed and rule 69 of the MSBS Rules made under Part 2 of the Military Superannuation and Benefits Act 1991 make provision for the payment of interest where benefit payments are delayed.
4 Purpose and operation of instrument
The determination sets the rates of interest to be applied and prescribes the methodology for the calculation of interest on lump sums and pensions in circumstances where the Board has exercised its power under rule 69 to add an amount of interest to a benefit because of a delay in its payment.
5 Consultation
As the instrument is for internal machinery of Government purposes only,
no consultation was considered necessary with other persons (see sections
17 and 18 of the Legislative Instruments Act 2003).
Overview
The Military Superannuation and Benefits (Delayed Payment of Benefits) Determination 2009, established to address the need for clear guidelines on the calculation of interest on delayed benefit payments within the Military Superannuation and Benefits Scheme (MSBS), was enacted to ensure fairness and transparency for members of the Australian Defence Force. This determination serves to complement the Military Superannuation and Benefits Act 1991 and the MSBS Trust Deed by providing a specific methodology for calculating interest when benefit payments are delayed, thus enhancing the administration of the scheme. The determination was made by the relevant authority under the legislative instruments and took effect from the day after its registration on the Federal Register of Legislative Instruments, ensuring that the interests of service members are protected without necessitating external consultation due to its internal nature.
Scope and Application
The Military Superannuation and Benefits (Delayed Payment of Benefits) Determination 2009 applies to the Military Superannuation and Benefits Scheme (MSBS), an occupational superannuation scheme specifically designed for members of the Australian Defence Force. This determination outlines the interest rates and the methodology for calculating interest on lump sums and pensions when there is a delay in the payment of benefits, as provided under the Military Superannuation and Benefits Act 1991 and the MSBS Trust Deed. It is triggered when the Board exercises its power under rule 69 of the MSBS Rules to add interest to benefits due to delayed payments. The determination is designed to take effect from the day after its registration on the Federal Register of Legislative Instruments, and as it pertains to the internal machinery of the Government, no external consultation was deemed necessary. The scope of the determination is confined to the internal governance of the MSBS, and no subordinate instruments extend or restrict its application.
Key Provisions
The Military Superannuation and Benefits (Delayed Payment of Benefits) Determination 2009 (the Determination) specifies the interest rates to be applied when benefit payments under the Military Superannuation and Benefits Scheme (MSBS) are delayed. According to section 4, this applies to both lump sum payments and pensions. The interest is calculated in accordance with the provisions outlined in section 5 of the Determination, ensuring that the interest rate is applied when a benefit payment is not made within the stipulated time frame.
The Determination imposes obligations on the MSBS Board to ensure that interest is calculated and added to delayed benefit payments. This includes determining the appropriate interest rate and applying the prescribed methodology for calculating the interest amount. The Board is also required to communicate the interest amount to the relevant beneficiaries and ensure that the interest is included in the benefit payment.
Breach of the provisions outlined in the Determination can lead to legal consequences. While specific offences and penalties are not detailed in the Explanatory Statement, it is implied that failure to comply with the Determination could result in administrative or legal action. Typically, under the Military Superannuation and Benefits Act 1991, penalties for non-compliance could include fines or other civil remedies. However, the maximum penalties are not specified in the Explanatory Statement.
In summary, the Determination sets out clear guidelines for the calculation and application of interest on delayed benefit payments under the MSBS. It mandates the MSBS Board to adhere to these guidelines, ensuring that beneficiaries receive the correct interest amounts when payments are delayed. While specific penalties for non-compliance are not detailed, adherence to the Determination is crucial to avoid potential legal repercussions.