Explanatory statement
accompanying
Revocation of Modification Declarations
Superannuation Industry (Supervision) Act 1993
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Authority
1. This explanatory statement is issued by the Australian Prudential Regulation Authority (APRA).
The instrument to which this explanatory statement relates
2. This explanatory statement relates to the instrument entitled Revocation of Modification Declarations which has been made under section 335 of the Superannuation Industry (Supervision) Act 1993 (the SIS Act) and which is dated 1 September 2005 (the Revocation). The Revocation revokes a number of redundant modification declarations which were made under section 332 of the SIS Act.
Relevant legislative provisions
3. Section 332 of the SIS Act empowers APRA to make modification declarations which modify certain modifiable provisions of the SIS Act or the regulations made under that Act. The “modifiable provisions” are identified in section 327. Before the establishment of APRA in 1998, the modification power in section 332 was exercisable by the Insurance and Superannuation Commissioner (an office-holder who was appointed under the Insurance and Superannuation Commissioner Act 1987).
4. Section 335 of the SIS Act empowers APRA to revoke modification declarations made under section 332.
Explanation of the Revocation
5. The Revocation revokes ten old modification declarations which were made by the Insurance and Superannuation Commissioner and which by their terms have ceased to have effect or which have been made redundant by subsequent legislative amendments or the effluxion of time. Their revocation is essentially a “legislative house-keeping” exercise.
6. The following is a brief explanation of why each of the modification declarations is being revoked.
Modification Declaration No 2 (made on 3 August 1994)
Modified section 90 of the SIS Act.
By virtue of subsection 90(2), section 90 does not apply after 1 July 1995.
Modification Declaration No 4 (made on 8 November 1994)
Modified various provisions of the SIS Act and the Superannuation Industry (Supervision) Regulations 1994 (the SIS Regulations) relating to eligible rollover funds and unclaimed money.
The modification declaration specifies that it has no effect after 30 June 1995.
Modification Declaration No 7 (made on 24 February 1995)
Modified various provisions of Part 5 of the SIS Regulations.
The modification declaration specifies that it has no effect after 30 June 1996.
Modification Declaration No 8 (made on 23 March 1995)
Modified section 247 of the SIS Act.
The modification declaration specifies that it has no effect after 30 June 1995.
Modification Declaration No 11 (made on 12 October 1995)
Modified regulation 2.19 of the SIS Regulations.
Regulation 2.19 was repealed in 2002 by the Superannuation Industry (Supervision) Amendment Regulations 2002 (No 1).
Modification Declaration No 14 (made on 6 June 1996)
Modified sections 248 and 251 of the SIS Act and regulation 2.11A of the SIS Regulations.
The modification of section 248 was superseded by the subsequent amendment of section 248 in 1997 which was made by the Retirement Savings Accounts (Consequential Amendments) Act 1997.
Section 251 effected an alteration in the rights of certain members of eligible rollover funds whose benefits were transferred to the eligible rollover fund prior to 1 July 1995; the modification declaration extended the application of section 251 to members whose benefits were transferred to the eligible rollover fund pursuant to regulation 21 of the applied OSS Regulations. Regulation 21 of the applied OSS Regulations was added to the applied OSS Regulations by Temporary Modification Declaration No 24 (which was made under section 333 of the SIS Act). Temporary Modification Declaration No 24 specified that it had no effect after 30 June 1996. Hence, members’ benefits could not be transferred to an eligible rollover fund pursuant to regulation 21 of the applied OSS Regulations after 30 June 1996. The modification of section 251 is therefore no longer needed.
Regulation 2.11A of the SIS Regulations was repealed in 2002 by the Superannuation Industry (Supervision) Amendment Regulations 2002 (No 1).
Modification Declaration No 15 (made on 24 July 1996)
Added a new section 153A to the SIS Act which qualified the operation of section 153 of the SIS Act.
Section 153 was repealed with effect from 11 March 2002 by the Financial Services Reform (Consequential Provisions) Act 2001.
Modification Declaration No 16 (made on 22 October 1996)
Modified subsection 225(2) of the SIS Act, which requires trustees of superannuation funds to give the Australian Securities and Investments Commission half-yearly statements relating to the amount of unclaimed money in their fund, by specifying that the subsection does not apply to a half-year beginning before 1997.
The modification is no longer necessary as 1997 is long past.
Modification Declaration No 18 (made on 16 January 1997)
Modified regulation 2.21 of the SIS Regulations.
Regulation 2.21 was repealed in 2002 by the Superannuation Industry (Supervision) Amendment Regulations 2002 (No 1).
Modification Declaration No 21 (made on 15 May 1997)
Added a new regulation 2.14AA to the SIS Regulations, which qualified certain obligations imposed by Division 2.3 of Part 2 of the SIS Regulations.
Division 2.3 was repealed in 2002 by the Superannuation Industry (Supervision) Amendment Regulations 2002 (No 1).
7. Note that, by virtue of section 15 of the Legislative Instruments Act 2003 (the LIA), the revocation of the modification declarations does not affect their operation prior to the revocation, nor does it affect any right acquired or obligation or liability incurred by any person under the modification declarations prior to the revocation.
Consultation
8. Section 17 of the LIA imposes consultation obligations on the makers of legislative instruments, particularly where the proposed instrument is likely to have a direct, or a substantial indirect, effect on business, or to restrict competition.
9. Section 18 of the LIA sets out circumstances where consultation may be unnecessary or inappropriate. They include the circumstance that the legislative instrument is of a minor or machinery nature and does not substantially alter existing arrangements (paragraph 18(2)(a)).
10. In the present case, the Revocation revokes modification declarations that are already inoperative or inapplicable. Hence the Revocation is merely of a legal machinery nature, and therefore consultation is not warranted.