EXPLANATORY STATEMENT
STATUTORY RULES 1990 NO. 416
SUPERANNUATION (PRODUCTIVITY BENEFIT) ACT 1988 (THE ACT)
ISSUED BY THE AUTHORITY OF THE MINISTER FOR FINANCE
DECLARATION UNDER SUBSECTIONS 4A(1) AND (2) OF THE ACT
This instrument has two purposes. Firstly, it declares, under section 4A(1) of the Act, the staff of the Central Land Council to be “class employees” so that a specified arrangement can be applied to them. (To facilitate the grouping of Declarations with the same purpose, this instrument repeals and remakes a previous Declaration on the same topic.) Secondly, it specifies an alternative arrangement in respect of the 3 per cent superannuation benefit that is to be applied to the employees of the Central Land Council.
DECLARATION UNDER SUBSECTION 4A(1)
CLASSES OF EMPLOYEES TO BE NEITHER FUND EMPLOYEES NOR INTERIM ARRANGEMENT EMPLOYEES
The Superannuation (Productivity Benefit) Act 1988 provides the mechanism by which a 3 per cent superannuation benefit is made available to Australian Government employees without other superannuation coverage.
The designated employers of such employees are required to pay to either the superannuation fund nominated by the Minister for Finance or another fund approved by the Minister, periodic contributions based on the salary of the employee.
The employers are also required to pay to the same fund, on a once-only basis, amounts which represent the entitlement accrued by the employees under the Act in respect of service with the employers prior to the date the employees joined the fund.
The Act also provides a mechanism for the continued payment of a benefit directly by the employer where the employee does not become a member of a fund before becoming entitled to a benefit. The Act provides for a superannuation benefit to be provided to “remainder employees”. “Remainder employees” are “qualified employees” who are not:
members either of the Commonwealth Superannuation Scheme or the Public Sector Superannuation Scheme; or
“class employees”.
A “class employee” is an employee who is a member of a class specified in a declaration issued under section 4A(1). Unless the conditions in the declaration specify otherwise, there is no requirement that continuing contributions be made to a superannuation fund for such an employee, and that employee is also excluded from the benefit paid directly by the employer to employees who do not become members of superannuation funds. The declaration under section 4A may also specify other arrangements that are to apply to a declared class.
The Superannuation Benefits (Supervisory Mechanisms) Act 1988 provides that the Minister for Finance may approve the provision of superannuation outside the main Commonwealth schemes for Australian Government employees in one of two ways. He may either:
approve a scheme which provides superannuation for such employees; or
issue superannuation guidelines to enable the employer to establish or amend a superannuation scheme without the need for detailed approval.
The superannuation guidelines issued by the Minister have provided the employers to whom they have been issued with the power to provide a 3 per cent superannuation benefit. That benefit need not be provided in the same way as the benefit under the Superannuation Benefit (Interim Arrangement) Act 1988 or the Superannuation (Productivity Benefit) Act 1988.
Statutory Rules 1990 No. 175 Superannuation (Productivity Benefit) Declaration No. 4 made into “class employees” all employees of employers to whom superannuation guidelines have been issued and other employers for whom the Minister has approved a superannuation scheme which provides a 3 per cent benefit.
The Declaration also made into “class employees” a number of categories of employees who are provided with an employer-financed 3 per cent benefit through some other means. To date. Declaration No. 4 is the only “class employees” declaration.
Subsequent to that Declaration, it has become necessary for the Minister to declare the staff of the Central Land
Council to be “class employees” in order that specified arrangements as described below be applied to them. To give effect to this and to facilitate the grouping of Declarations with the same title it is necessary to repeal Superannuation (Productivity Benefit) Declaration No. 4 and make Superannuation (Productivity Benefit) (Alternative Arrangements) Declaration No. 1 which declares the employees of the Central Land Council to be “class employees” in addition to the employees previously listed in the Schedule to the Superannuation (Productivity Benefit) Declaration No. 4.
DECLARATION UNDER SUBSECTION 4A(2)
SPECIFIED ARRANGEMENT FOR A NEW CATEGORY OF “CLASS EMPLOYEE”
The Minister may declare under subsection 4A(2) of the Act that specified arrangements about superannuation or similar benefits are to apply to a declared class of employee.
This Declaration makes the employees of the Central Land Council “class employees” under subsection 4A(1) of the Act. It also applies a specified arrangement under subsection 4A(2) to the employees of the Central Land Council which allows them to elect to become a member of the Nominated Fund, an Approved Fund or the superannuation fund called the AMP Superleader Plan. This has the effect of providing employees of the Central Land Council with an additional option to elect to join the AMP Superleader Plan.