EXPLANATORY STATEMENT
STATUTORY RULES 1982 NO 235
ISSUED BY THE AUTHORITY OF THE MINISTER FOR FINANCE
SUPERANNUATION ACT 1976 - SUPERANNUATION (ELIGIBLE EMPLOYEES) REGULATIONS (AMENDMENT)
LEGISLATIVE BASIS FOR THE REGULATIONS
The Superannuation Act 1976 (the Act) provides a contributory superannuation scheme for Commonwealth employees.
Section 168 of the Act provides that the Governor-General may make regulations, not inconsistent with the Act, prescribing matters that the Act requires or permits to be prescribed, or that are necessary or convenient to be prescribed, for carrying out or giving effect to the Act.
Persons eligible to contribute under the Act are referred to in the Act as “eligible employees”.
Sub-section 3(1) of the Act defines the term “eligible employee”. In accordance with the definition, the term does not include a person included in a prescribed class of persons. Thus, certain classes of employees may be excluded by regulation from becoming contributors. The classes of persons so excluded are prescribed in the Superannuation (Eligible Employees) Regulations.
BACKGROUND
The Australian Shipping Commission is an “approved authority” for the purposes of the Act. Full time officers, employees and Statutory office holders of the Commission may, at their own request, contribute under the Act, subject to certain service qualifications.
The Commission intends to establish a separate superannuation scheme for its Commissioners, officers and employees with effect from 1 October 1982.
Existing Commissioners, officers and employees who are “eligible employees” for the purposes of the Act will be given the option of transferring to the new scheme. Officers and employees who do so will cease to be “eligible employees” by virtue of paragraph 4(a) of the Superannuation (Eligible Employees) Regulations, which provides that employees of an “approved authority” who are members of a superannuation or retirement scheme applying to that authority, or who are required by their terms and conditions of employment to become members of such a scheme cease to be contributors under the Act. There is, however, no comparable provision in the Regulations that ceases Commissioners (and statutory office holders in general) as contributors under the Act and it is intended that this situation be remedied in the proposed amending regulations.
It is also intended that persons who are Commissioners, officers or employees of the Commission as at 1 October 1982, or are appointed or become employed after that date, and who are not “eligible employees” for the purposes of the Act, will not be entitled to become contributors under the Act in future. Such persons will look to the Commission’s own scheme for any superannuation cover.
An exception is made in the case of former contributors who were entitled to invalidity pension under the Act immediately before being appointed to or employed by the Commission. It is appropriate that such persons again become contributors under the Act upon the cancellation of their invalidity pensions and, accordingly, the regulations do not exclude them from becoming “eligible employees”.
CONTENT OF THE REGULATIONS
The amendments to the Superannuation (Eligible Employees) Regulations contained in the Statutory Rule exclude from becoming contributors under the Act:-
(a) statutory office holders who are members of, or who are required by their terms and conditions of employment to become members of, a superannuation or retirement scheme applying to holders of that office;
(b) persons who were Commissioners, officers or employees of the Commission immediately before 1 October 1982 who were not contributors; and
(c) persons who are appointed to or become employed by the Commission on or after 1 October 1982 who immediately before being so appointed or employed were not contributors and not entitled to invalidity pension.
Overview
The Superannuation (Eligible Employees) Regulations (Amendment) Statutory Rules 1982 No. 235, issued under the authority of the Minister for Finance, were enacted to address the need for adjustments in eligibility criteria for superannuation contributions under the Superannuation Act 1976. The primary issue these regulations sought to resolve was the inclusion of certain classes of employees in the superannuation scheme, particularly in light of the Australian Shipping Commission's establishment of a separate superannuation scheme for its own Commissioners, officers, and employees from 1 October 1982. The regulations aim to exclude specific groups from becoming contributors to the Commonwealth superannuation scheme, ensuring alignment with the new scheme and preventing double contributions. The policy objective of these amendments is to provide clarity and specificity in the eligibility criteria for superannuation contributions, reflecting the changes in employment and superannuation schemes within the Commission.
Scope and Application
The Superannuation (Eligible Employees) Regulations (Amendment) Statutory Rules 1982 No. 235, issued under the authority of the Minister for Finance, modify the eligibility criteria for contributors under the Superannuation Act 1976. The Act provides a contributory superannuation scheme for Commonwealth employees, and eligible employees, defined in section 3(1) of the Act, are those not included in certain prescribed classes. The regulations specify who may be excluded from becoming contributors, which is essential for the operation of the Act. The amendments respond to the Australian Shipping Commission's establishment of a separate superannuation scheme for its Commissioners, officers, and employees effective from 1 October 1982. Under these amendments, statutory office holders who are members of, or required to join, a superannuation or retirement scheme related to their office are excluded from contributing to the Act. Similarly, those who were Commissioners, officers, or employees of the Commission before 1 October 1982 and were not contributors, as well as those appointed or employed on or after that date who were not contributors and not entitled to an invalidity pension, are also excluded. An exception is made for former contributors entitled to an invalidity pension under the Act before joining the Commission, who will again become contributors upon the cancellation of their pensions. The regulations thereby clarify and restrict the eligibility for superannuation contributions under the Act in light of the new superannuation arrangements for the Australian Shipping Commission.
Key Provisions
The Superannuation (Eligible Employees) Regulations (Amendment) Statutory Rules 1982 No. 235, issued under the authority of the Minister for Finance, amend the existing Superannuation (Eligible Employees) Regulations to align with the Australian Shipping Commission's new superannuation scheme. These amendments, found in section 3(1) of the Superannuation Act 1976, specify classes of employees who are ineligible to contribute under the Act. Specifically, the regulations exclude statutory office holders who are members of or required to join a superannuation or retirement scheme applicable to their office, persons who were Commissioners, officers, or employees of the Commission before 1 October 1982 and were not contributors, and those appointed or employed by the Commission on or after 1 October 1982 who were not contributors and not entitled to invalidity pensions.
Under the amended regulations, statutory office holders, including Commissioners and statutory office holders of the Australian Shipping Commission, who are members of or required to join a superannuation or retirement scheme applicable to their office, will cease to be eligible to contribute under the Act. Similarly, individuals who were Commissioners, officers, or employees of the Commission before 1 October 1982 and were not contributors will no longer be eligible to contribute. Furthermore, any individuals appointed or employed by the Commission on or after 1 October 1982 who were not contributors and were not entitled to invalidity pensions will also be excluded from eligibility. However, former contributors who were entitled to invalidity pensions under the Act before being appointed or employed by the Commission will not be excluded and can again become contributors upon the cancellation of their invalidity pensions.
The regulations impose certain obligations on parties governed by them. The Australian Shipping Commission must ensure that its Commissioners, officers, and employees who are affected by the amendments are aware of their new status and that they understand the implications of these changes. The Commission is also responsible for implementing the new superannuation scheme for its employees and ensuring that any transfers from the existing scheme to the new one are handled correctly. In addition, the Commission must ensure that those who were former contributors and are now eligible to contribute again understand their new entitlements and how to access them. There are no specific offences, penalties, or civil/criminal consequences outlined in the explanatory statement for breaches of these regulations. However, failure to comply with the regulations could potentially lead to legal challenges or disputes regarding superannuation entitlements.