Superannuation (Productivity Benefit) 1996-97 Continuing Contributions
Declaration 1996 No. 116
EXPLANATORY STATEMENT
STATUTORY RULES 1996 No. 116
SUPERANNUATION (PRODUCTIVITY BENEFIT) ACT 1998
ISSUED BY THE AUTHORITY OF THE MINISTER FOR FINANCE
DECLARATION UNDER SECTION 3D
VARIATION OF TABLE
The Superannuation (Productivity Benefit) Act 1988 (the PB Act) provides the mechanism by which the Superannuation Guarantee (SG) is made available to Australian Government employees who have no other employer sponsored superannuation coverage. Prior to 1 July 1992, the PB Act provided productivity superannuation to these employees.
The designated employers of such employees are required to pay to the superannuation fund nominated by the Minister for Finance, or another superannuation fund approved by the Minister or to a regulated fund under the Superannuation Industry Supervision legislation (where the employee is eligible), periodic contributions based on the salary of the employee. The amount to be contributed is calculated using a table set out in the Schedule to the Act. The Table is structured so the, a proportionately greater benefit is provided to lower paid wage earners. The amount to be contributed is adjusted where the employee is not employed full-time. The rates in this table apply for the 1996-97 financial year.
The benefits provided under the Act comply with the minimum requirements of the SG legislation. The only employees receiving superannuation under the Act who do not receive a flat rate superannuation contribution equivalent to 6 per cent of their salaries are those for whom that amount would represent a reduction (ie below the minimum weekly benefit for lower paid wage earners of $13.53) and those on salaries in excess of $90,360 per annum who receive a flat contribution equivalent to 6 per cent of $90,360 (ie $104.26 per week), as required by the SG legislation.
The Declaration commences on 1 July 1996.
Overview
The Superannuation (Productivity Benefit) Act 1998 was enacted to address the need for a supplementary superannuation contribution mechanism for Australian Government employees who lack other employer-sponsored superannuation coverage. This legislation was introduced by the Commonwealth Parliament to ensure that these employees receive a superannuation benefit that meets the minimum requirements of the Superannuation Guarantee (SG) legislation. The policy objective of the Act is to provide a proportionately greater benefit to lower paid wage earners, while ensuring that contributions for higher earners comply with the SG mandate of a flat rate superannuation contribution equivalent to 6 per cent of their salaries, subject to a minimum weekly benefit threshold and a maximum salary cap. The Act requires designated employers to make periodic contributions to a superannuation fund approved by the Minister for Finance or a regulated fund under the Superannuation Industry Supervision legislation, based on the employee’s salary. This contribution rate is adjusted for part-time employees and is specified in a table set out in the Schedule to the Act, which applies for the 1996-97 financial year.
Scope and Application
The Superannuation (Productivity Benefit) 1996-97 Continuing Contributions Declaration 1996 No. 116 applies to designated employers who are responsible for making contributions to the superannuation funds of Australian Government employees without other employer-sponsored superannuation coverage. These employers include government departments and agencies, public sector entities, and any other bodies as designated by the Minister for Finance. The Act applies nationally across Australia, ensuring compliance with the Superannuation Guarantee (SG) legislation. It mandates that employers make periodic contributions to approved superannuation funds based on the employees' salaries, with the rates adjusted for full-time and part-time employment, ensuring proportionate benefits particularly for lower-paid wage earners. This Act is effective for the 1996-97 financial year and is issued under the authority of the Minister for Finance. The specific rates and thresholds for contributions are detailed in the Schedule to the Act, which may be varied through subordinate instruments as needed.
Key Provisions
The main operative sections of the Superannuation (Productivity Benefit) 1996-97 Continuing Contributions Declaration 1996 No. 116 (the Declaration) require designated employers to make continuing contributions to a superannuation fund for employees who do not have other employer-sponsored superannuation coverage. Under Section 3D of the Superannuation (Productivity Benefit) Act 1988 (the PB Act), these contributions are calculated using a table set out in the Schedule to the Act, which adjusts the contribution rates based on the employee's salary. For the 1996-97 financial year, the rates are specified in this Declaration. The contribution rates are designed to provide a proportionately greater benefit to lower-paid employees. Employers must contribute to the superannuation fund nominated by the Minister for Finance or an approved alternative fund. For full-time employees, contributions are based on their full-time salary, while part-time employees receive a proportionate contribution.
The obligations imposed on parties governed by this Act include ensuring that designated employers make the required contributions to the specified superannuation funds. Employers must adhere to the calculation methods and rates provided in the Schedule, which vary according to the employee's salary and employment status. Employers must ensure that the correct amount of contributions is made on a periodic basis as required by the Act. Failure to comply with these obligations may result in the employer being liable for any shortfall in contributions owed to the employees.
There are no explicit offences, penalties, or civil/criminal consequences mentioned in the text for breaches of this Declaration. However, non-compliance with the obligations to make required contributions could potentially lead to legal repercussions under the broader superannuation legislation, including the Superannuation Guarantee (SG) provisions. The SG legislation mandates that employers must contribute a minimum of 9.25% of an employee’s ordinary time earnings to an approved superannuation fund, and failure to do so can result in penalties, including fines and imprisonment. Given the connection between the PB Act and the SG requirements, any breach of the obligations under this Declaration could implicate the employer in broader superannuation compliance issues.