Superannuation (Former Eligible Employees) Regulations (Amendment)

Overview

The Superannuation (Former Eligible Employees) Regulations (Amendment) 1991 No. 161 was enacted to address the transition in the management and investment of the Commonwealth Superannuation Fund No. 2 from the Superannuation Fund Investment Trust to the joint employer/employee Commonwealth Superannuation Board of Trustees No. 2. This change was mandated by section 64 of the Commonwealth Funds Management Limited Act 1990 and was aligned with the Occupational Superannuation Standards Act 1987. The Regulations were issued under the authority of the Minister for Finance and were designed to ensure the smooth implementation of the legislative amendments to the Superannuation Act 1976. The policy objective of these Regulations was to maintain the integrity of the superannuation scheme while transferring administrative responsibilities, ensuring that all management costs continued to be met from the Fund rather than Consolidated Revenue. The Regulations commenced on 1 July 1991, the same day as the legislative amendments they were designed to implement.

Scope and Application

The Superannuation (Former Eligible Employees) Regulations (Amendment) 1991 No. 161 amends the existing regulations under the Superannuation Act 1976 to reflect the transfer of responsibilities from the Superannuation Fund Investment Trust to the Commonwealth Superannuation Board of Trustees No. 2, as mandated by the Commonwealth Funds Management Limited Act 1990. The Superannuation Act 1976 applies to Commonwealth employees and other eligible persons who are members of a contributory superannuation scheme, and the regulations govern the administration, costs, and specific transitions of former eligible employees into new schemes. The regulations pertain to the Commonwealth level, impacting the management and investment of the Commonwealth Superannuation Fund No. 2, which includes contributions from members and employers. The amendments ensure that the costs of administration and management of the Fund are paid from the Fund itself, rather than from Consolidated Revenue, aligning with existing policy. The regulations also cover the transfer of assets to new schemes like the Australia Post Superannuation Scheme and the Telecom Superannuation Scheme for employees transitioning between 1 July 1990 and 1 March 1991. The changes under these regulations will take effect from 1 July 1991, when the amendments to the Superannuation Act 1976 come into force.

Key Provisions

The Superannuation (Cost of Administration) Regulations (Amendment) 1991 No. 161 and the Superannuation (Former Eligible Employees) Regulations (Amendment) 1991 No. 161 are amendments to existing regulations under the Superannuation Act 1976 (the Act). These regulations reflect changes introduced by the Commonwealth Funds Management Limited Act 1990, which will transfer the responsibility of managing and investing the Commonwealth Superannuation Fund No. 2 from the Superannuation Fund Investment Trust (the Trust) to the Commonwealth Superannuation Board of Trustees No. 2 (the Board). This change aligns with the Occupational Superannuation Standards Act 1987. The amendments are set to take effect from 1 July 1991. The amended Superannuation (Cost of Administration) Regulations (regulation 2) ensure that all costs associated with the management of the Fund by the Board will continue to be paid out of the Fund, consistent with existing policy. This approach prevents these costs from being covered by Consolidated Revenue. The Superannuation (Former Eligible Employees) Regulations (regulations 8 and 9) are also amended to reflect the change in the management of the Fund. Specifically, these regulations modify the Act to provide for the transfer of assets from the Fund to other superannuation schemes for former eligible employees who transition to the Australia Post Superannuation Scheme (APSS) or the Telecom Superannuation Scheme (TSS) between 1 July 1990 and 1 March 1991. These regulations impose certain obligations on the parties involved. The Board, as the new entity responsible for managing the Fund, must ensure that all management and investment activities are conducted in accordance with the Act and the relevant regulations. The Board is also responsible for ensuring that the costs of administration are paid out of the Fund, as stipulated in the amended regulations. Additionally, the Board must facilitate the transfer of assets to other superannuation schemes for former eligible employees as outlined in the regulations. Employers and members of the superannuation scheme must continue to make their required contributions to the Fund, with the understanding that these contributions will now be managed and invested by the Board. Failure to comply with the requirements set out in these regulations may result in legal consequences. While the specific offences, penalties, or consequences for non-compliance are not detailed in the explanatory statement, the Act and the regulations generally provide for penalties for breaches. These penalties can include fines or other civil or criminal sanctions, depending on the nature and severity of the breach. The maximum penalties for such breaches would be determined by the relevant sections of the Act and other applicable laws. Compliance with these regulations is crucial to avoid potential legal repercussions for the Board, employers, and members involved in the superannuation scheme.