Superannuation (CSS) Productivity Contribution (2020-2021) Declaration 2020 – Explanatory Statement
1 Name of Determination
This declaration is the Superannuation (CSS) Productivity Contribution
(2020-2021) Declaration 2020.
2 Commencement
This declaration commences on 1 July 2020.
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 2020 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 (2020-2021) Declaration 2020 is a legislative instrument established under the Superannuation Act 1976. This Act provides for the Commonwealth Superannuation Scheme (CSS), an occupational superannuation scheme for Commonwealth employees and certain other persons. Specifically, this declaration addresses the productivity contributions required by employers of scheme members who do not pay such contributions to another scheme. The declaration sets out new productivity contribution rates to apply from 1 July 2020 and is designed to maintain an average contribution rate of 3% of salaries. Enacted by the Commonwealth Superannuation Corporation (CSC), this instrument does not engage any applicable rights or freedoms and is compatible with human rights.
Scope and Application
The Superannuation (CSS) Productivity Contribution (2020-2021) Declaration 2020 applies to the Commonwealth Superannuation Scheme (CSS) which is an occupational superannuation scheme for Commonwealth employees and certain other persons. The declaration sets out the new productivity contribution rates for the 2020-2021 period and is applicable to all employers who do not pay productivity contributions in respect of their employees to another scheme. The rate of contribution is to be maintained at an average of 3% of salaries and is set out in the Table in section 110C of the Superannuation Act 1976. The Commonwealth Superannuation Corporation (CSC) is responsible for making the declaration and has the power to vary the rates set out in the table. The declaration commences on 1 July 2020 and applies nationally across Australia. There are no stated exclusions or exemptions from the declaration. Subordinate instruments may be used to extend or restrict the application of the declaration.
Key Provisions
The Superannuation (CSS) Productivity Contribution (2020-2021) Declaration 2020 sets out the productivity contribution rates for the Commonwealth Superannuation Scheme (CSS) for the specified period. The declaration outlines the specific rates that employers must pay for each member of the scheme (section 110C). These rates are adjusted annually and vary according to the member's salary, with the intention that the contribution rate average should remain at 3% of salaries. Employers who are not paying productivity contributions to another scheme are required to make these contributions to the CSS, as stipulated in section 110H of the Superannuation Act 1976. The Commonwealth Superannuation Corporation (CSC) is responsible for making these payments to the CSS Fund, as outlined in section 110N of the Act.
The declaration imposes several obligations on the parties involved. Employers of members in the CSS must ensure they are contributing at the correct rate as specified by the declaration. This includes calculating the appropriate amount based on the member's salary and making the fortnightly payments to the CSC. The CSC, in turn, is responsible for processing these contributions and transferring them to the CSS Fund. The declaration also mandates that the CSC must update the productivity contribution rates annually, with the changes coming into effect from 1 July each year. The CSC has the authority to adjust the contribution rates as needed, as delegated by the Superannuation Act 1976 (section 110D).
Failure to comply with the requirements of this declaration can result in legal consequences. Although specific penalties are not detailed within the explanatory statement, breaches of the Superannuation Act 1976 can lead to civil and criminal penalties. These may include fines and, in severe cases, imprisonment. Employers who do not adhere to their obligations under section 110H could be subject to these penalties. It is important for all parties to understand and comply with their obligations to avoid potential legal ramifications.