explanatory statement
Issued by the authority of the Minister for Superannuation and Corporate Law, acting for and on behalf of the Minister for Finance and Deregulation
Superannuation Act 1976
Declaration under paragraph (j) of the definition of “eligible employee” in subsection 3(1)
The Superannuation Act 1976 (the 1976 Act) makes provision for and in relation to the Commonwealth Superannuation Scheme (CSS) for Australian Government employees and for certain other persons.
Subsection 3(1) of the 1976 Act contains the definition of the term “eligible employee” that describes various classes of persons who may contribute to the CSS (CSS members). Paragraph (j) of the definition provides that the Minister may declare a class of persons not to be CSS members.
The Superannuation (CSS) (Eligible Employees – Exclusion) Declaration 2003 (the Principal Declaration) identifies the persons who are declared not to be CSS members under paragraph (j) of the definition of eligible employee.
The purpose of the Superannuation (CSS) (Eligible Employees – Exclusion) Amendment Declaration 2009 (No. 1) (the Declaration) is to amend the Principal Declaration in order to provide when employees of Health Services Australia Limited cease CSS membership.
Under a merger arrangement, Health Services Australia Limited will become a wholly owned subsidiary of Medibank with effect from 1 April 2009. Health Services Australia Limited will no longer be an “approved authority” under the Act, meaning that its employees will no longer be eligible to contribute to the CSS unless they are identified as a CSS member under a different paragraph of the definition of "eligible employee". The Superannuation (CSS) Eligible Employees – Inclusion) Amendment Declaration 2009 (No. 1) (the Inclusion Declaration) makes such amendments.
The Declaration provides that CSS membership of Health Services Australia Limited employees provided by the Inclusion Declaration will cease when they cease their employment with Health Services Australia Limited or become members of an alternative superannuation scheme. It may also cease if Health Services Australia Limited ceases to be owned by Medibank or Commonwealth control of Medibank ceases. This promotes the consistency of arrangements for Health Services Australia Limited employees with Medibank employees, whose CSS membership can only continue while Medibank is subject to Commonwealth control.
Medibank and Health Services Australia Limited were consulted on the amendments contained in the Declaration.
The Declaration is a legislative instrument for the purposes of the Legislative Instruments Act 2003.
The Declaration commences on 1 April 2009.
The details of the Declaration are explained in the Attachment.
Attachment
Superannuation (CSS) (Eligible Employees – Exclusion) Amendment Declaration 2009 (No. 1)
Section 1 - Name of Declaration
This section provides that the name of the Declaration is the Superannuation (CSS) (Eligible Employees – Exclusion) Amendment Declaration 2009 (No. 1).
Section 2 - Commencement
This section provides for the Declaration to commence on 1 April 2009.
Section 3 - Amendment of Superannuation (CSS) Eligible Employees – Exclusion) Declaration 2003
This section provides that Schedule 1 of the Declaration amends the Superannuation (CSS) Eligible Employees – Exclusion) Declaration 2003 (the Principal Declaration).
Schedule 1 - Amendments
Item 1 inserts a definition of Health Services Australia Limited for the purposes of the Principal Declaration. Health Services Australia Limited is defined as the company (ACN 078 934 791) that was incorporated under the Corporations Law on 17 June 1997.
Item 2 inserts item 24 into the table at Schedule 1 of the Principal Declaration. Item 24 provides that CSS membership ceases for a person who has CSS membership through paragraph 4(2)(p) of the Principal Declaration when any of the following events occur:
- the person ceases employment with Health Services Australia Limited;
- the person becomes a casual or temporary part-time employee of Health Services Australia Limited;
- Health Services Australia Limited ceases to be owned by Medibank; or
- Commonwealth control of Medibank ceases.
Item 24 also specifies the time that CSS membership is taken to cease for each of the circumstances above.
Overview
The Superannuation (CSS) (Eligible Employees – Exclusion) Amendment Declaration 2009 (No. 1) was enacted to address the issue arising from the merger of Health Services Australia Limited with Medibank, which was set to occur on 1 April 2009. This legislation was introduced to ensure the appropriate cessation of Commonwealth Superannuation Scheme (CSS) membership for employees of Health Services Australia Limited once the merger was complete. By amending the existing Superannuation (CSS) Eligible Employees – Exclusion Declaration 2003, the Declaration aligns the superannuation arrangements of Health Services Australia Limited employees with those of Medibank employees. The policy objective is to maintain consistency in superannuation arrangements under Commonwealth control.
This legislative instrument was issued under the authority of the Minister for Superannuation and Corporate Law, acting on behalf of the Minister for Finance and Deregulation. The Declaration ensures that CSS membership for Health Services Australia Limited employees ceases under specific conditions, such as the termination of employment, change to a casual or temporary part-time status, loss of Medibank ownership, or the cessation of Commonwealth control over Medibank. The Declaration commenced on 1 April 2009, aligning with the timing of the merger.
Scope and Application
The Superannuation (CSS) (Eligible Employees – Exclusion) Amendment Declaration 2009 (No. 1) amends the Superannuation (CSS) (Eligible Employees – Exclusion) Declaration 2003 to modify the eligibility of certain employees for Commonwealth Superannuation Scheme (CSS) membership. Specifically, the amendment addresses the CSS membership status of employees of Health Services Australia Limited following its merger with Medibank, effective from 1 April 2009. The amendment declares that these employees will no longer be eligible for CSS membership when Health Services Australia Limited ceases to be an approved authority under the Superannuation Act 1976. This change ensures that their CSS membership will terminate upon cessation of employment with Health Services Australia Limited, transition to casual or temporary part-time employment, or if Health Services Australia Limited is no longer owned by Medibank, or if Commonwealth control of Medibank ceases. This amendment is designed to align the superannuation arrangements for Health Services Australia Limited employees with those of Medibank employees, maintaining consistency in eligibility criteria.
Key Provisions
The Superannuation (CSS) (Eligible Employees – Exclusion) Amendment Declaration 2009 (No. 1) amends the existing Superannuation (CSS) (Eligible Employees – Exclusion) Declaration 2003, focusing on the eligibility of employees of Health Services Australia Limited for Commonwealth Superannuation Scheme (CSS) membership. Specifically, the Declaration modifies the Principal Declaration to reflect changes following the merger of Health Services Australia Limited with Medibank, effective from 1 April 2009 (Section 2). This amendment ensures that the eligibility criteria for CSS membership align with the new corporate structure and ownership (Section 3).
Under the amended Declaration, CSS membership for Health Services Australia Limited employees is contingent upon specific conditions. Primarily, CSS membership will cease if an employee leaves their job with Health Services Australia Limited or if they become members of another superannuation scheme (Item 2, Schedule 1). Additionally, membership will also terminate if Health Services Australia Limited ceases to be owned by Medibank, or if Commonwealth control over Medibank ends. This ensures a consistent approach to CSS membership eligibility between Health Services Australia Limited and Medibank employees, reflecting the current ownership and control structures (Item 24, Schedule 1).
The Declaration imposes several obligations on the parties involved. Health Services Australia Limited must ensure that its employees are aware of the changes in CSS membership eligibility and the conditions under which their membership may cease. Similarly, employees must remain cognizant of their employment status and any changes in their employment conditions or in the ownership of their employer. The Declaration also requires Medibank to maintain ownership of Health Services Australia Limited and ensure that Commonwealth control over Medibank is sustained to preserve CSS membership for Health Services Australia Limited employees (Item 24, Schedule 1).
Breach of the provisions outlined in the Declaration may lead to consequences for both Health Services Australia Limited and its employees. If Health Services Australia Limited fails to adhere to the conditions for CSS membership, it may face administrative or legal repercussions. Employees who do not comply with the terms of their CSS membership may lose their eligibility for the scheme. While the Declaration does not explicitly state penalties for breaches, non-compliance could result in administrative actions or legal proceedings under the Superannuation Act 1976, potentially leading to financial penalties or other legal consequences.