Superannuation (CSS) Productivity Contribution (2017-2018) Declaration 2017 – Explanatory Statement
1 Name of Determination
This declaration is the Superannuation (CSS) Productivity Contribution
(2017-2018) Declaration 2017.
2 Commencement
This declaration shall take effect on 1 July 2017.
3 Background
The Superannuation Act 1976 (the Act) makes provision for, and in relation to, the Commonwealth Superannuation Scheme (CSS) which is an occupational superannuation scheme for Commonwealth employees and for certain other persons.
Part VIA of the Act comprising sections 110A to 110S provides for a funded productivity superannuation benefit for members of the scheme.
Section 110H of the Act requires the employer of a member of the scheme who does not pay productivity contributions in respect of the member to another scheme to pay fortnightly "productivity contributions" to the CSS.
In accordance with section 110N of the Act the Commonwealth Superannuation Corporation (CSC) must pay such contributions to the CSS Fund which is established by the Act.
4 Purpose and operation of instrument
The fortnightly rate of productivity contribution payable by an employer in relation to a member is set out in the Table in section 110C of the Act. This rate varies according to the member's salary. The intention is that the contribution rate be maintained at an average of 3% of salaries.
Section 110D provides that amounts of salary and contribution specified in the Table may be varied by a Declaration by CSC in relation to a period specified in the declaration. CSC has delegated this power to relevant officers in Commonwealth Superannuation Administration.
The Table set out in section 110C is amended with effect from 1 July each year by a Declaration by CSC.
5 New Productivity Contribution Rates
The new productivity contribution rates to apply with effect from 1 July 2017 are set out in the declaration.
6 References to CSC
Section 5 of the Governance of Australian Government Superannuation Schemes Act 2011 provides that “the board established by section 20 of the Superannuation Act 1990 as the Australian Reward Investment Alliance continues in existence by force of that section as a body corporate, under and subject to the provisions of this Act, under the name Commonwealth Superannuation Corporation (CSC)”.
In accordance with section 25B of the Acts Interpretation Act 1901, any reference to Australian Reward Investment Alliance (ARIA) in an instrument made prior to 1 July 2011 shall be construed as a reference to the CSC.
7 Consultation
As the instrument is for internal machinery of Government purposes only, no consultation was considered necessary with other persons (see sections 15J(2) and 17 of the Legislation Act 2003).
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Human rights implications
This Legislative Instrument does not engage any of the applicable rights or freedoms.
Conclusion
This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.
Overview
The Superannuation (CSS) Productivity Contribution (2017-2018) Declaration 2017 was enacted by the Commonwealth Superannuation Corporation (CSC) under the authority granted by the Superannuation Act 1976. This legislation was introduced to establish the productivity contribution rates for members of the Commonwealth Superannuation Scheme (CSS) for the financial year 2017-2018. The Act provides for a funded productivity superannuation benefit for members of the CSS and mandates that employers who do not contribute to another scheme must make fortnightly productivity contributions to the CSS. These contributions are to be paid to the CSS Fund by the CSC, with the intention of maintaining the contribution rate at an average of 3% of salaries. The declaration, which took effect on 1 July 2017, sets out the new productivity contribution rates for the specified period.
Scope and Application
The Superannuation (CSS) Productivity Contribution (2017-2018) Declaration 2017 applies to the Commonwealth Superannuation Scheme (CSS), an occupational superannuation scheme for Commonwealth employees and certain other persons. The declaration specifically pertains to productivity contributions required by employers who do not pay such contributions to another scheme, as stipulated by section 110H of the Superannuation Act 1976. The Commonwealth Superannuation Corporation (CSC), established under the Governance of Australian Government Superannuation Schemes Act 2011, is responsible for paying these contributions to the CSS Fund, as outlined in section 110N of the Superannuation Act 1976. The rates of these contributions are set by the declaration and vary according to the member's salary, with an intended average of 3% of salaries. The declaration, which takes effect from 1 July 2017, amends the contribution rates in the Table set out in section 110C of the Act annually. The declaration applies nationally across Australia, as it is a Commonwealth instrument, and no consultation with external parties was deemed necessary due to its internal governmental nature.
Key Provisions
The Superannuation (CSS) Productivity Contribution (2017-2018) Declaration 2017 sets forth the rates for productivity contributions applicable to members of the Commonwealth Superannuation Scheme (CSS) for the period starting 1 July 2017 (section 5). This Declaration, which comes into effect on the same date, modifies the contribution rates as stipulated in the Table in section 110C of the Superannuation Act 1976. These rates are designed to maintain an average contribution level of 3% of members' salaries (section 110C). The Commonwealth Superannuation Corporation (CSC), established under section 5 of the Governance of Australian Government Superannuation Schemes Act 2011, is responsible for making these adjustments. The CSC has the authority to vary the amounts of salary and contributions specified in the Table, as outlined in section 110D of the Superannuation Act 1976, and has delegated this power to relevant officers in the Commonwealth Superannuation Administration.
Employers of CSS members who do not contribute to another scheme are required to make fortnightly productivity contributions to the CSS, as mandated by section 110H of the Superannuation Act 1976. These contributions are to be paid to the CSS Fund, which is established by the Act, as per section 110N. The new contribution rates for the period starting 1 July 2017 are detailed in the Declaration. The CSC, through the Commonwealth Superannuation Administration, is tasked with ensuring that these contributions are accurately calculated and remitted in line with the updated rates.
The Superannuation Act 1976 imposes several obligations on the parties involved. Employers of CSS members must ensure that they comply with the productivity contribution requirements set out in section 110H and remit the correct amount to the CSS Fund as per section 110N. The CSC, in its capacity as the governing body for the CSS, must oversee the administration of these contributions, including the calculation and adjustment of contribution rates, as provided for in sections 110D and 110C of the Act. The CSC's role includes publishing the new contribution rates and ensuring that these are reflected in the CSS Fund.
Breaches of the obligations under the Superannuation Act 1976 may result in various penalties and consequences. Employers who fail to make the required productivity contributions can be subject to fines and other penalties as prescribed by the Act. While the exact penalties are not specified in the Declaration, they are typically set out in the Superannuation Act 1976 and related regulations. Failure to comply with these obligations can lead to civil or criminal liability, depending on the nature and severity of the breach. It is important for employers and the CSC to adhere strictly to the provisions of the Act to avoid these potential consequences.