Superannuation (CSS) Productivity Contribution (2021-2022) Declaration 2021 – Explanatory Statement
1 Name of Determination
This declaration is the Superannuation (CSS) Productivity Contribution
(2021-2022) Declaration 2021.
2 Commencement
This declaration commences on 1 July 2021.
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 2021 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 (2021-2022) Declaration 2021 is an instrument made under the authority of the Superannuation Act 1976 to set the fortnightly productivity contribution rates for the Commonwealth Superannuation Scheme (CSS). Enacted by the Commonwealth Superannuation Corporation (CSC), the declaration aims to ensure that the productivity contribution rates for CSS members remain at an average of 3% of their salaries, as mandated by section 110H of the Act. This declaration updates the contribution rates effective from 1 July 2021, aligning with the intention to maintain the average contribution rate and to facilitate the funding of productivity benefits within the scheme. The declaration operates under the legislative framework established by Part VIA of the Superannuation Act 1976, with no external consultation deemed necessary as it pertains to internal government operations.
Scope and Application
The Superannuation (CSS) Productivity Contribution (2021-2022) Declaration 2021 is an instrument under the Superannuation Act 1976, which governs the Commonwealth Superannuation Scheme (CSS), an occupational superannuation scheme for Commonwealth employees and certain other persons. This declaration sets the fortnightly productivity contribution rates for employers in relation to their members, with the intention of maintaining the contribution rate at an average of 3% of salaries. The Commonwealth Superannuation Corporation (CSC), as established by the Governance of Australian Government Superannuation Schemes Act 2011, is responsible for setting these rates, which are varied annually with effect from 1 July each year. The declaration commences on 1 July 2021 and applies nationally as it pertains to the Commonwealth's internal machinery. It does not require consultation with external parties as it is for internal government purposes only, and it has been assessed as compatible with human rights, as it does not engage any of the applicable rights or freedoms.
Key Provisions
The Superannuation (CSS) Productivity Contribution (2021-2022) Declaration 2021 outlines the specific rates at which employers must contribute to the Commonwealth Superannuation Scheme (CSS) for the financial year starting 1 July 2021. These contributions are intended to fund productivity benefits for CSS members (section 110C). Employers, as required by section 110H of the Superannuation Act 1976, must make fortnightly productivity contributions to the CSS if they do not pay such contributions to another scheme. The Commonwealth Superannuation Corporation (CSC), established under section 5 of the Governance of Australian Government Superannuation Schemes Act 2011, is tasked with paying these contributions to the CSS Fund (section 110N).
The Act imposes specific obligations on employers to calculate and remit the productivity contributions based on the member's salary, as detailed in the Table set out in section 110C. These contributions are intended to average 3% of the member's salary. The CSC has the authority to vary the amounts of salary and contribution specified in this table through a declaration, as per section 110D. The CSC has delegated this power to relevant officers within the Commonwealth Superannuation Administration.
Failure to comply with the requirements set forth in the Act could result in civil or criminal consequences. The Act does not explicitly detail penalties for non-compliance, but generally, breaches of superannuation obligations can lead to substantial fines and potential imprisonment. Employers who fail to remit the required contributions could face legal action from the Commonwealth Superannuation Corporation or other relevant authorities, which may include financial penalties and other remedial measures. Additionally, there could be implications for the affected employees' superannuation benefits, potentially impacting their retirement income.