MILITARY SUPERANNUATION AND BENEFITS ACT 1991

MILITARY SUPERANNUATION AND BENEFITS TRUST DEED AMENDMENT 2008 (NO.1)

EXPLANATORY STATEMENT

The Military Superannuation and Benefits Act 1991 (“the Act”) in section 4 required the making of a deed (“the Trust Deed”) to establish the details of administration of the Military Superannuation and Benefits defined benefit superannuation scheme (“the MSBS Scheme”) by Military Superannuation and Benefits Board of Trustees No. 1 (the Board).

The Schedule to the Trust Deed made by the Minister for Defence Science and Personnel under section 5 of the MSB Act contains Rules (the MSB Rules) which deal with the benefits to be provided to members of the MSB Scheme upon retirement, or to dependants of deceased members of the scheme. 

Section 5 of the Act provides that the Trust Deed may be amended by legislative instrument signed by the Minister, with the consent of the Board.

The purpose of this Determination is to amend the Trust Deed to make a range of changes that will remove discrimination against same-sex couples and the children of same-sex relationships from the administration of the scheme. The changes are consistent with recent changes in the Same-Sex Relationships (Equal Treatment in Commonwealth Laws—Superannuation) Act 2008 (the Superannuation Act). The amendments provide for the payment of benefits to the same-sex partner, and to an eligible child, of an eligible scheme member who dies on or after the commencement of the amendments. These classes of person have been excluded from the scope of the benefits provided under military superannuation schemes as they fall outside the scope of relevant definitions. The extension of the Act to these previously excluded persons is achieved by amending definitions under the Trust Deed to provide that they are inclusive of same-sex partners and children of a same-sex relationship of an eligible scheme member. These new potential beneficiaries are required to meet the same tests for eligibility as opposite-sex partners and children currently included in the scheme.

Clause 1 sets out the manner in which this Instrument may be cited.

Clause 2 provides that the amendments commence on 1 January 2009, the same day on which Schedule 3 of the Superannuation Act is proclaimed to commence. The commencement date will ensure that the instrument commences at the same time as the parallel reforms to the suite of legislation establishing other Commonwealth superannuation schemes.

Clause 3 provides that this instrument makes amendments to the Trust Deed.

Schedule 1 includes a range of amendments to the Deed and Rules.

The amendment made by item 1 to subrule 2(1) of the Trust Deed amends a cross-reference to the concept of a marital relationship to refer instead to the new term “marital or couple relationship”. The intent of the amendment is to remove discrimination against same-sex couples, while at the same time continuing the recognition of the distinct legal status of marriage.

The amendments made by items 2 and 3 to rule 89 of the Trust Deed insert two cross-references to the source definitions for the terms ‘member spouse’ and ‘non-member spouse’, which are drawn from the Family Law Act 1975. This prevents any confusion between the special meaning given to those terms used in Part 13 of the Rules, and use of the term ‘spouse’ elsewhere in the Rules, where its meaning is affected by Parts 1A and 5 of Schedule 1 to the Rules. Inserting a cross-reference will also ensure that the definitions in Part 13 remain current in the event that the Family Law Act definitions are amended, as occurs indirectly on the commencement of item 55 of Schedule 1 to the Family Law Amendment (De Facto Financial Matters and Other Measures) Act 2008.

The amendment made by item 4 of Schedule 1 substitutes the extended definition of ‘child’ in the Glossary at Schedule 1 of the Rules. The item expands the classes of children that may be taken to be a child of the member for the purpose of determining whether benefits may be paid to the child on the death of the member by including a child who is taken to be the child of a member for the purposes of the Family Law Act 1975.  Similar to the amendment in items 2 and 3, referring to a single definition found in family law will remove sexual preference discrimination and allow for issues around parental relationships and beneficial legislation to be interpreted in a consistent manner.

• New subparagraph (a) of the extended definition of ‘child’ expands the classes of children that may be taken to be a child of the member for the purpose of determining whether benefits may be paid to the child on the death of the member. The definition now includes a child who is taken to have had a parent/child relationship with a member for the purposes of the Family Law Act 1975. Referring to a single definition found in family law will remove discrimination against same-sex couples based on a single definition that will allow for issues around parental relationships and beneficial legislation to be interpreted in a consistent manner.
• Subparagraph (b) includes material previously located at subsubparagraph (a)(i). The movement of the information reflects a simplified structure to assist the reader.
• Subparagraph (c) includes material previously located at subsubparagraph (a)(ii). The movement of the information reflects a simplified structure to assist the reader. As a result of the amendment made by item 8 of Schedule 1, paragraph (c) of the amended definition of ‘child’ in item 4 also includes a child who would have been a stepchild, but for the fact that the child’s parent and the parent’s partner were not legally married.
• Subparagraph (d) includes material previously located at subparagraph (b). The movement of the information reflects a simplified structure to assist the reader.
• New subparagraph (e) of the definition of ‘child’ in the Glossary at Schedule 1 of the Rules provides that a child can be considered to be the member’s for the purpose of the scheme where the child is the child of the member’s spouse or partner and a relationship that the partner had with another person. Subsubparagraph (e)(ii) requires that the child was wholly or substantially dependent on the member at the time the member died.

Proposed new subparagraphs (a) and (e) of the definition of ‘child’ extend the scope of the definition to include any child who, under the Family Law Act 1975, (as amended by the Family Law Amendment (De Facto Financial Matters and Other Measures) Act 2008), is a child of the member or his or her spouse. This will include, amongst others, a child:

• born to a woman as the result of carrying out an artificial conception procedure while she was married to, or was a de facto partner of another person (whether of the same or opposite sex), where the woman and that other person consented to the procedure or the child is their child under a prescribed law of a State or Territory;
• born to a woman as the result of carrying out an artificial conception procedure where the child is her child under prescribed law of a State or Territory; and
• born under a surrogacy arrangement, if a court has made an order under a prescribed law of a State or Territory determining that the person is a parent of the child.

Item 5 of Schedule 1 inserts a signpost into the listing of definitions in the Glossary at Schedule 1 to the Rules, to indicate that the term ‘marital or couple relationship’ is to be interpreted subject to Part 1A of Schedule 1 to the Rules. Retaining the reference to a marital relationship ensures that the distinct legal status of marriage is recognised while removing discrimination against same-sex couples.

Item 6 of Schedule 1 inserts a signpost into the listing of definitions in the Glossary at Schedule 1 to the Rules, to indicate that the term ‘partner’ is to be interpreted subject to Part 1A of Schedule 1 to the Rules.

Item 7 of Schedule 1 amends paragraph (b) of the definition of ‘spouse’ to make clear that it includes a person in a marital or couple relationship, interpreted subject to the amended Part 1A and Part 5 of the Act.

Item 8 of Schedule 1 inserts new definition of the term ‘stepchild’ into the Glossary at Schedule 1 of the Rules. The item expands the class of children that may be taken to be a child of the member for the purpose of determining whether benefits may be paid to the child on the death of the member by including a child who would have been a stepchild, but for the fact that the child’s parent and the parent’s partner were not legally married.  This amendment is necessary because the dictionary definition of a stepchild is restricted to a child raised in the context of a legal marriage and excludes de facto couples. The amendment thus permits recognition of a child who is unable to be considered as a stepchild only because the couple raising him or her are in a de facto relationship and not in a legal marriage.

Item 9 of Schedule 1 amends the heading of Part 1A of Schedule 1 to the Rules, which refers to the concept of a marital relationship, to refer instead to the new term ‘marital or couple relationship’. Retaining the reference to a marital relationship ensures that the distinct legal status of marriage is recognised while removing discrimination against same-sex couples.

Item 10 of Schedule 1 amends paragraph 1A of Schedule 1 to the Rules. The express wording of paragraph 1A, as including only a ‘marital relationship’ restricted to persons ordinarily living together as ‘husband or wife’, meant that only persons in a marriage or an opposite-sex de facto relationship could previously be considered for the purposes of benefits payable on the death of a spouse who was a member under the MSBS Scheme. The amendments made by this item supplement the phrase ‘husband or wife’ with the term ‘partner’. The effect of this amendment is to ensure that the definition of a relationship, for the purpose of the payment of death benefits under the MSBS Act, includes a same-sex relationship as well as an opposite-sex relationship. The inclusion of same-sex relationships within this definition is not intended to change the treatment of married or opposite-sex de facto couples. It removes same-sex discrimination but does not change or re-define any other indicia of a relationship.

Item 11 of Schedule 1 inserts a new paragraph 1AA to define the concept of a ‘partner’ for the purposes of a marital or couple relationship under Part 1A. The inclusion of same-sex relationships within this definition is not intended to change the treatment of opposite-sex de facto couples. It removes same-sex discrimination but does not change or re-define any other indicia of a relationship. The factual indicia set out in paragraph 1C are applied to couples in the same way whether the couples are the same sex or different sexes.

Items 12 and 13 of Schedule 1 amend paragraph 1B of Schedule 1 to the Rules as a consequence of the amendments made by items 7, 9 and 10 of this instrument.

Item 14 of the Schedule amends paragraph 1C of Schedule 1 to the Rules. It inserts a new subparagraph (ba), which incorporates a cross-reference to new section 22B of the Acts Interpretation Act 1901 as a consequence of the insertion of a definition of de facto partner into that Act by item 1 of Schedule 1 to the Superannuation Act.  The effect of this amendment is that in working out when a person is in a marital or couple relationship for the purposes of the MSB Scheme, relevant evidence will include whether that person’s relationship is registered under a State or Territory law prescribed for the purposes of section 22B of the Acts Interpretation Act, as a kind of relationship prescribed for the purposes of that section. 

Item 15 of the Schedule substitutes subparagraph 1C(c) of Schedule 1 to the Rules. This extends the scope of the factual indicia to include any child who, under the Family Law Act 1975, (as amended by the Family Law Amendment (De Facto Financial Matters and Other Measures) Act 2008), is a child of the persons seeking recognition of a marital or couple relationship. The effect of the amendment to paragraph 1C of Schedule 1 to the Rules is to extend the classes of persons who can be considered to be in a marital or couple relationship, having regard to whether there is a child of the relationship, for the payment of death or pension benefits to persons in same-sex relationships. The effect of this amendment is that in working out when a person is in a marital or couple relationship for the purposes of the MSBS Scheme, relevant evidence will include whether the persons had a child who was a child of both the persons for the purposes of the Family Law Act.

Items 16, 17 and 18 make changes to Part 5 consequential upon the amendments made by items 7 and 10 of the Schedule. The amendments made by items 16 and 17 will assist the Board in determining whether two persons of the same sex had a ‘couple relationship’ where the relationship has less than 3 years’ duration.

Item 19 omits paragraph 12 of Schedule 1 to the Rules, to remove the express discrimination against same-sex couples. The non-discriminatory amendments made by this instrument mean that this restriction is no longer consistent with the proper operation of the MSB Scheme.

This is a legislative instrument for the purpose of section 44(2) of the Legislative Instruments Act 2003 (LIA) and is not subject to disallowance in accordance with item 39 of the table in subsection 44(2) or sunsetting in accordance with item 42 of the table in subsection 54(2) of the LIA.

Consultation was considered inappropriate and unnecessary pursuant to paragraph 18(2)(g) of the LIA because the Determination relates to the service of members of the Australian Defence Force.

A regulation impact statement is not required.

       Authority: Section 5 of the Military Superannuation and Benefits Act 1991