Superannuation (CSS) Productivity Employee Inclusion Declaration No. 2 1994 No. 29
EXPLANATORY STATEMENT
STATUTORY RULES 1994 No. 29
Issued by the authority of the Minister for Finance
Superannuation Act 1976
Declaration under section 110F
The Superannuation Act 1976 (the 1976 Act) provides for a superannuation scheme for Commonwealth employees and certain other persons. That scheme is referred to as the Commonwealth Superannuation Scheme (the CSS).
The Superannuation Guarantee (Administration) Act 1992 (the SG Act) provides for employers to provide a minimum level of employer superannuation support for employees with effect from 1 July 1992.
To assist employers whose staff are members of the scheme under the 1976 Act to provide for the minimum level of superannuation provided for in the SG Act the 1976 Act was amended, with effect from 1 July 1992, to provide for a superannuation guarantee top-up benefit (the top-up benefit) for members of the CSS in certain circumstances.
Section 110SE of the 1976 Act provides for the top-up benefit and is provided only for members who have productivity contributions paid in respect of them by their employer either to the CSS or to another superannuation scheme applying to them for the provision of productivity benefits.
Since 1 July 1990 employers of productivity employees have been required to pay productivity contributions in respect of their employees to the scheme under the 1976 Act. A "productivity employee" is defined in section 110A of the 1976 Act and does not include persons mentioned in subparagraphs (a)(i), (ii), (iii) and (iv) of the definition but does include persons in respect of whom a declaration is in force under section 110F of the 1976 Act.
Section 110F of the 1976 Act provides that the Minister for Finance may declare a member of the CSS who is described in subparagraph (a)(i), (ii) or (iii) of the definition of productivity employer to be a productivity employee for the purposes of Part VIA of the 1976 Act. Section 110F of the 1976 Act also provides that a declaration under the section takes effect from such day, not earlier than 1 July 1990, as is specified in the declaration.
Persons excluded by subparagraph (a)(ii) of the definition of productivity employee in section 110A of the 1976 Act includes members of the scheme under the 1976 Act who are employees of a State or a State authority. The Legal Aid Commission of New South Wales has requested that they be entitled to pay productivity contributions to the scheme so that employees may be covered for the SG top-up benefit. It is appropriate for CSS members to be covered for the SG top-up benefit to ensure that employers whose staff are members of the scheme do not have a superannuation guarantee shortfall in respect of those employees.
The declaration will allow the payment of productivity contributions in respect of certain employees previously excluded from the productivity benefit arrangements in the 1976 Act and assist the Legal Aid Commission of New South Wales to fulfil its obligations under the SG Act.
The Declaration takes effect from 1 July 1992 being the date of commencement of the superannuation guarantee arrangements and the top-up benefit arrangements in the 1976 Act.
The Declaration is made in respect of employees of the Legal Aid Commission of New South Wales and imposes a liability on the Commission. The Commission has indicated its acceptance of the liability, including the retrospective application, as its preferred means of meeting its Superannuation Guantantee obligations.
Section 110G provides that a declaration under section 110F of the Act is a statutory rule for the purposes of the Statutory Rules Publication Act 1903 and a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901.
Overview
The Superannuation Act 1976, as amended, provides a superannuation scheme for Commonwealth employees and certain other persons, known as the Commonwealth Superannuation Scheme (CSS). This Act was designed to establish a framework for superannuation contributions for eligible employees, including a provision for a superannuation guarantee top-up benefit under certain circumstances, to complement the requirements of the Superannuation Guarantee (Administration) Act 1992. This legislation aims to address the gap in superannuation support by ensuring that employers of CSS members can meet the minimum superannuation guarantee requirements, particularly through the top-up benefit mechanism. The Superannuation Act 1976 was enacted by the Parliament of Australia to provide a structured approach to superannuation for specific employee groups. The policy objective of this Act is to ensure that all eligible employees, including those previously excluded, are covered under a superannuation scheme that meets the mandated superannuation guarantee standards, thus preventing any shortfall for employers.
Scope and Application
The Superannuation (CSS) Productivity Employee Inclusion Declaration No. 2 1994 No. 29 applies to the Legal Aid Commission of New South Wales, allowing it to pay productivity contributions in respect of its employees to the Commonwealth Superannuation Scheme (CSS) for the purpose of ensuring these employees are eligible for the superannuation guarantee top-up benefit. The declaration addresses a specific exclusion under section 110A of the Superannuation Act 1976, which previously did not include employees of state authorities, such as the Legal Aid Commission, within the scope of productivity contributions. This inclusion is intended to ensure that employers of these employees do not incur a superannuation guarantee shortfall. The declaration takes effect from 1 July 1992, aligning with the commencement date of the superannuation guarantee arrangements and the top-up benefit arrangements in the 1976 Act. The declaration is a statutory rule under the Statutory Rules Publication Act 1903 and is subject to disallowance under section 46A of the Acts Interpretation Act 1901.
Key Provisions
The main operative sections of this legislation include Section 110F, which empowers the Minister for Finance to declare a CSS member as a productivity employee, and Section 110SE, which provides for the superannuation guarantee top-up benefit for eligible CSS members. The declaration under Section 110F, which is made to allow certain employees to be covered under the productivity benefit arrangements, has been issued to include employees of the Legal Aid Commission of New South Wales. This declaration takes effect from 1 July 1992, aligning with the commencement of the superannuation guarantee arrangements and the top-up benefit arrangements in the 1976 Act. This legislation imposes a liability on the Legal Aid Commission of New South Wales to pay productivity contributions for its employees, as per the declaration under Section 110F. The Commission has agreed to accept this liability, including its retrospective application, as a means to meet its obligations under the Superannuation Guarantee (Administration) Act 1992.
The obligations and requirements imposed by this Act on the parties it governs are primarily centered around the payment of productivity contributions by employers for their eligible employees. In this case, the Legal Aid Commission of New South Wales is required to pay such contributions for its employees who are now covered under the productivity benefit arrangements. This requirement ensures that these employees are eligible for the superannuation guarantee top-up benefit, as provided under Section 110SE of the 1976 Act. The declaration under Section 110F facilitates this process by classifying certain employees as productivity employees, who were previously excluded from the productivity benefit arrangements.
The breach of this legislation could result in various civil and criminal consequences. For instance, failure to pay the required productivity contributions could lead to a superannuation guarantee shortfall, which might result in financial penalties and legal action against the employer. Moreover, under Section 110G of the 1976 Act, a declaration under Section 110F is considered a statutory rule for the purposes of the Statutory Rules Publication Act 1903 and a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901. This implies that the declaration can be disallowed by either House of the Parliament, which could have legal and financial implications for the employer. However, the legislation does not specify any maximum penalties for breaches.