EXPLANATORY STATEMENT
STATUTORY RULES 1988 NO 41
ISSUED BY THE AUTHORITY OF THE MINISTER FOR FINANCE
SUPERANNUATION ACT 1976
SUPERANNUATION (ELIGIBLE EMPLOYEES) REGULATIONS (AMENDMENT)
Section 168 of the Superannuation Act 1976 (the Act) provides that the Governor-General may make regulations, not inconsistent with the Act, prescribing all 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.
The Act provides a contributory superannuation scheme for Commonwealth employees. Persons eligible to contribute under the Act are referred to in the Act as “eligible employees”.
Subsection 3(1) of the Act defines the term “eligible employee”. In accordance with paragraph (j) of the definition, the term does not include a person included in a prescribed class of persons. Thus, certain classes of persons may be excluded by regulation from becoming, or remaining, contributors. The classes of persons so excluded are prescribed in the Superannuation (Eligible Employees) Regulations (the Regulations).
The Victorian domestic meat inspection function and associated staff are to be transferred to the Commonwealth on 3 April 1988. The transferred staff are to be appointed as officers for the purposes of the Public Service Act 1922 on that date.
The transferees are to have the following options in relation to superannuation:
(a) for those who are members of a State superannuation scheme immediately before the date of transfer, the option of:
(i) remaining members of the State scheme; or
(ii) ceasing membership of the State scheme and becoming members of the Commonwealth scheme established under the Act; and
(b) for those who are not members of a State superannuation scheme immediately before the date of transfer, the option of becoming members of the Commonwealth scheme at, or at any time after, the date of transfer.
Under the Act, permanent employees, including officers for the purposes of the Public Service Act 1922, are required to become eligible employees for the purposes of the Act. Thus, all of the transferees will be required to become eligible employees unless excluded from doing so by the Regulations.
The existing paragraph 4(o) of the Regulations will operate to exclude from becoming eligible employees those in group (a) above who elect to remain members of the State scheme. Amendment of the Regulations is, however, necessary in relation to those in group (b) to exclude them from becoming eligible employees unless they elect to do so.
The Statutory Rule amends the Regulations accordingly.
The amendments are to come into operation on 3 April 1988.
Overview
The Superannuation (Eligible Employees) Regulations (Amendment) 1988, issued under the authority of the Minister for Finance, addresses a specific gap in the Superannuation Act 1976 by amending the eligibility criteria for employees to contribute to the Commonwealth superannuation scheme. This amendment was necessitated by the transfer of the Victorian domestic meat inspection function and its staff to the Commonwealth, which occurred on 3 April 1988. The policy objective behind these amendments is to provide clarity and options for the transferred staff regarding their participation in the superannuation scheme, allowing those who were previously members of a State superannuation scheme to either remain in their existing scheme or join the Commonwealth scheme, and enabling those who were not members of a State scheme to join the Commonwealth scheme. This regulatory change ensures that the superannuation provisions are effectively applied to the newly transferred employees in alignment with the overarching objectives of the Superannuation Act 1976.
Scope and Application
The Superannuation Act 1976 applies to eligible employees within the Commonwealth, providing a contributory superannuation scheme for these individuals. The Act ensures that permanent employees, including those appointed under the Public Service Act 1922, are required to become eligible employees for the purposes of the Act unless they fall within a prescribed class of excluded persons. The Superannuation (Eligible Employees) Regulations further detail the criteria for eligibility and exclusion, with specific provisions regarding the transfer of staff from the Victorian domestic meat inspection function to the Commonwealth. These Regulations have been amended to provide options for transferred staff concerning their superannuation membership, allowing those who were members of a State superannuation scheme to remain in that scheme or join the Commonwealth scheme, and those not in a State scheme to elect to join the Commonwealth scheme. The amendments to the Regulations came into effect on 3 April 1988, ensuring that the transferees have the appropriate superannuation options available to them.
Key Provisions
The Superannuation (Eligible Employees) Regulations (Amendment) Statutory Rule 1988 No. 41 (the Amendment) makes significant changes to the Superannuation (Eligible Employees) Regulations (the Regulations) under the Superannuation Act 1976 (the Act). Section 168 of the Act allows for the creation of regulations necessary for the Act’s implementation, and this Amendment specifically modifies the eligibility criteria for employees to become eligible employees, who are required to participate in the Commonwealth’s contributory superannuation scheme.
Under the Act, eligible employees are defined in section 3(1), with certain exclusions prescribed by regulation. The Amendment amends the Regulations to address the transfer of Victorian domestic meat inspection staff to the Commonwealth on 3 April 1988. Specifically, paragraph 4(o) of the Regulations will exclude from eligibility those employees who choose to remain in their State superannuation scheme. However, employees who are not members of a State superannuation scheme prior to the transfer will now be required to actively opt into the Commonwealth scheme if they wish to become eligible employees.
These regulations impose clear obligations on the affected employees. Those transferring to the Commonwealth on 3 April 1988 who are already members of a State superannuation scheme must decide whether to remain in that scheme or join the Commonwealth scheme. Employees not currently in a State scheme must opt into the Commonwealth scheme if they wish to become eligible employees. This decision must be made by the commencement date of the Amendment, 3 April 1988.
Failure to comply with these requirements may lead to serious consequences. Although the Amendment does not explicitly state penalties, non-compliance with the Act's provisions regarding superannuation eligibility could result in legal action, including potential fines or other penalties as prescribed under the Superannuation Act 1976. These could include civil penalties for incorrect contributions or administrative actions to rectify non-compliance.